Negative Reversals Across the Board
By Harry Boxer, The Technical Trader (
www.thetechtrader.com)
It was a very nasty negative mid-afternoon reversal on Wall Street today that lasted until the close, with the stock market indices closing near the lows for the day going away.
The day started out with a big gap up on strong futures. They pulled back and appeared to be successfully retesting the nominal breakout of the large wedge pattern on the S&P 500. However, when a mid-afternoon rally attempt made only nominal new highs and couldn't follow through, they rolled over very hard. The Nasdaq 100, having reached nearly 1800, got down under 1760, a 40-point decline in the last few hours. The S&P 500 dropped from about 1365 to 1345.
Net on the day Dow was down nearly 11, the S&P 500 1.21 and the Nasdaq 100 15 1/2. The Philadelphia Semiconductor Index (SOXX) fell 4 1/2. So, the indices had negative reversals across the board.
The technicals, which were much stronger earlier, were barely ahead on advance-declines on New York by just 140 issues. They were negative by 300 issues on Nasdaq. Up/down volume was negative by about 7 to 6 on New York and by about 2 1/2 to 1 on Nasdaq. Total volume was a bit lighter today, with less than 1 1/4 billion traded on New York and about 1.8 billion on Nasdaq.
TheTechTrader.com board was very mixed, with several point-plus gainers and losers. On the plus side, the shippers led the way by far and had an outstanding relative strength day, with TBS International (TBSI) up 3.07, DryShips (DRYS) 2.75, and Excel Maritime (EXM) 1.06.
On the downside, Sigma Designs (SIGM) after a downgrade fell 4.75, pressing the 40 level again, a major loser on our board today. MELI was down 1.18. Those were the only point-plus losers on our board.
Stepping back and reviewing the hourly chart patterns, the large coil or wedge pattern on the indices appeared to be resolved to the upside early on today, but there was no follow-through and the indices rolled over and closed near the lows for the day going away, a very nasty afternoon reversal and an ugly way to start the week, with ominous downside implications for testing lower levels.
Good trading!
Harry
