Sell-Off Abated in Narrow, Mixed Options Expiration Session
By Harry Boxer, TheTechTrader.com (www.thetechtrader.com)
The market vacillated in a fairly narrow range and ended fairly mixed on options expiration day, which wasn't a surprise to us.
The day started out with a move down. They quickly stabilized near yesterday's lows on the Nasdaq 100 and made a higher low on the S&P 500, and then they had a sharp bounce early in the morning, which slightly exceeded resistance but failed to follow through. Then they sold off mid-day into the lunch hour. In early afternoon they started rallying again, got up near the session highs, but once again failed to break through, pulled back on the Nasdaq 100 and meandered sideways on the S&P.
Net on the day the Dow was down just 2.40, but the S&P 500 was up 4.13. The Nasdaq 100 was up just 3.13, and the Philadelphia Semiconductor Index (SOXX) up 2.46.
The technicals were much stronger than prices would indicate, with advance-declines 23 to 10 on New York, and a little better than 3 to 2 on Nasdaq. Up/down volume was even stronger, with a 2 , to 1 positive ratio on New York on total volume there of more than 1.6 billion. Nasdaq traded over 2 billion, and had a 4 to 3 positive ratio.
TheTechTrader.com board was extremely narrowly mixed, with just a couple point-plus losers and one point-plus gainer. On the plus side, with oil snapping back sharply today, the US Oil Fund (USO) ETF was up 1.20 on more than 6 million traded.
Energy Conversion Devices (ENER) advanced 93 cents, Sigma Designs (SIGM) 57 cents, and Chart of the Week Radio Shack (RSH) blew through 20 and tested key multi-month resistance at 20 ,, closing just beneath it at 20.43, up 72 cents on 5 , million.
Syntax-Brillian (BRLC) snapped back 35 cents, and Fuwei Films (FFHL) in the Chinese sector up 36 cents, with Chinese stocks firm today. Portfolio position Aluminum Corp. of China (ACH) was up 47 cents, and China GrenTech (GRRF) snapped back 22 cents.
For the most part, stocks were narrowly changed.
On the downside, loss leader today was HOKU, which gave back a big chunk of yesterday's rally, down 1.34 on 15 million shares, and VASCO Data Security (VDSI) lost 1.12 today.
Other stocks of note, XM Satellite Radio (XMSR) was down 73 cents, Simpletech (STEC) down 73 cents, and American Oriental Bioengineering (AOB) down 43 cents, with Home Inns & Hotels (HMIN) also off 69 cents today.
Stepping back and reviewing the hourly chart patterns, Nasdaq remains weaker than the S&P, although the NDX managed to gain today. Next week I think will be pivotal in determining the direction of the markets, as this week's sell-off abated somewhat today. Whether that's just a pause before additional losses or they can stabilize here and turn them around would be the key question to answer, and we'll likely get that answer probably early next week.
Good trading!
Harry
