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Thu October 22nd 2009
Closing with a Bang!
by Harry Boxer, www.TheTechTrader.com

The indices ended with a bang on Thursday, but they started out much differently.

The indices dropped sharply at the opening and went to new pullback lows. They were short-term oversold at that point, at key trendline support on the Nasdaq 100 and just below key initial support on the S&P 500. They rallied back in a 5-wave advance, with the 5th wave being the sharpest that took the indices to key overhead resistance, only backing off in the last half hour.

Net on the day the Dow was up 131.95 at 10081.31, the S&P 500 up 11.51 to 1092.91, and the Nasdaq 100 up 9.59 to 1763.15.

Advance-declines were about 2 to 1 positive on New York and about 5 to 3 positive Nasdaq. Up/down volume was 3 to 1 positive on New York on total volume of 1.3 billion. Nasdaq traded 2 1/4 billion and had a better than 2 to 1 positive volume ratio.

TheTechTrader.com board was mostly higher, with many point-plus gainers. Leading the way was the Direxion Financial Bull 3x Shares (FAS), up 6.28 to 87.12.

American International Group (AIG) jumped 2.46 to 41.49, Goldman Sachs (GS) 4.43 to 183.69, Wells Fargo (WFC) 1.27 to 30.17, and JP Morgan (JPM) 1.06 to 45.71.

Other stocks of note, Energy Conversion Devices (ENER) advanced 1.24 to 13.26, Human Genome Sciences (HGSI) 1.33 to 20.41, and RINO International (RINO) 1.89 to 23.74.

On the downside, the Direxion Financial Bear 3x Shares (FAZ) lost 1.57 to 18.61, and the Direxion Large Cap Bear 3X Shares (BGZ) 58 cents to 19.12. The Direxion Small Cap 3x Bear (TZA) lost 48 cents to 11.48.

Only other movers on our board were stocks with small fractional changes.

Stepping back and reviewing the hourly chart patterns, down early, and then a strong 5-wave advance brought the indices to nearly take back all the losses of the prior 24 hours.

So, a very impressive gain indeed and a strong solid close for the indices. Will there be any upside follow-through this time? We will see tomorrow, although TheTechTrader.com is closed, as I’m away at a trader’s group meeting in Scottsdale. We’ll see you on Monday.

Good trading!

Harry

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