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Closing Technical Market Analysis for Thu May 5th 2011
The stock market indices suffered a sharp decline with a very sharp selloff in the afternoon. They did come back in the last 30 minutes, but still it was a negative day across the board.
The day started out with a move down, The indices then bounced a couple times, retested the lows successfully, and then had a very sharp rally in the morning that reached 2402 on the Nasdaq 100 and as high as 1348 on the S&P 500. They backed off, retested, and tried to bounce, but when that rally failed midafternoon they rolled over sharply, dropping the NDX from 2398 down to 2367. That’s was more than a 30-point drop very quickly. The S&P 500 at that point dropped from 1346 to 1329. At the end they did snapback a bit.
Net on the day, the Dow was down 139.41 at 12,584.17. The S&P 500 was down 12.22 at 1335.10. The Nasdaq 100 was down 12.30 at 2375.21, but had been up about 20 earlier in the day.
Advance declines were 3 to 2 negative on the New York Stock Exchange and 3 to 2 negative on Nasdaq as well. Up/down volume was 8 to 3 negative on New York with total volume of 1.1 billion. Nasdaq traded 2.2 billion shares and had about a 4 to 3 negative volume ratio today.
TheTechTrader.com board, despite the big down day and some large losses on our board, actually had a lot of point-plus gainers. Leading the way, Polypore International Inc. (PPO), which announced blowout earnings, was up 10.51 to 65.88 on heavy volume.
Among other stocks of note, Sauer-Danfoss Inc. (SHS) was up 5.23 to 60.28, Ross Stores Inc. (ROST) 5.12 to 78.57, The Men's Wearhouse, Inc. (MW) 4.12 to 32.06, and BMC Software Inc. (BMC) 2.20 to 51.27.
In addition, Cbeyond, Inc. (CBEY) was up 1.24 to 14.23, ON Semiconductor Corp. (ONNN) 74 cents to 11.02, and Pericom Semiconductor Corp. (PSEM), also in that group, up 1.44 to 10.32. Leap Wireless International Inc. (LEAP) jumped 1.47 to 16.54, eOn Communications Corp. (EONC) 67 cents to 2.10, a 47% gain, and Electronic Arts Inc. (ERTS) 1.76 to 21.68. JDS Uniphase Corporation (JDSU) gained 1.39 to 21.39, Blue Dolphin Energy Company (BDCO) 1.20 to 6.64, and Silicon Graphics International Corp. (SGI) 1.56 to 22.05.
Other gainers included Chipotle Mexican Grill, Inc. (CMG) up 5.24 to 265.77, LSB Industries Inc. (LXU) 1.04 to 37.09 (and is higher in the aftermarket after they put out earnings report), and Velti Plc (VELT) up 1.56 to 17.66.
Ultra-short ETFs had a big gain today, the ProShares UltraShort Silver (ZSL) up 4.89 to 24.34 on 73 million shares, a record high. That stock traded under 13 last week. The ProShares UltraShort Oil & Gas (DUG) was up 1.19 to 29.77, as oil dropped $10 today, and the Direxion Daily Financial Bear 3X Shares (FAZ) gained 1.28 to 41.55.
On the downside, Apple Inc. (AAPL) lost 2.82 to 346.75, Amazon.com Inc. (AMZN) dropped 2.86 to 197.11, Dendreon Corp. (DNDN) lost another 1.39 to 38.05, and International Business Machines Corp. (IBM) fell 2.16 to 168.46. Goldman Sachs (GS) lost 1.11 to 150.41, Molycorp, Inc. (MCP) 3.55 to 68.46, Rediff.com India Ltd. (REDF) 1.29 to 12.59, and Vertex Pharmaceuticals Incorporated (VRTX) 2.12 to 53.19.
Definitely a mixed session, but there were many gainers to be had on our board today.
Stepping back and reviewing the hourly chart patterns, the indices were up sharply by late morning, but at the end of the day rolled over hard and closed down sharply on the day.
The indices have retraced about 50% of their run-up on the S&P 500, but only about a .382 fibonnacci retracement on the NDX.
We’ll see what tomorrow brings. We could be at an oversold zone and ready for some sort of snapback.
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