Another Huge Session!
By Harry Boxer, The Technical Trader (
www.thetechtrader.com)
It was another huge session. That's three in a row, with a negative one sandwiched in between, but a good way to close the week. The indices exploded in the afternoon, squeezed the shorts right into the close, and closed at the highs for the day going away.
The day started out with a brief pullback after the opening,then a steady morning rally moved the indices up to test initial key resistance. They then pullback and retested, held support, and then by mid-day started a very strong rally that took out the morning highs. When that occurred they were off to the races. A late pullback brought them back to retest the intraday moving averages, but in the last 15 minutes they popped again and ran up into the close.
The Dow closed up 261.60. The S&P 500 was up 31.09, and the Nasdaq 100 up 36.40. The Philadelphia Semiconductor Index (SOXX) was up about 5.
The technicals confirmed the move with a 23 to 8 advantage of advancers over decliners on New York. Nasdaq, however, was ahead by just 2 to 1. Up/down volume was nearly 3 1/2 to 1 positive on New York, on hefty volume of more nearly 2 3/4 billion. That was more than Nasdaq, which traded a little under that, with up/down volume 5 1/2 to 1 positive.
On TheTechTrader.com board, leading the way was Lehman (LEH), which accelerated late in the afternoon and shot up 6.42 today on 40 million shares, closing at 48.65. That stock was as low as 20 1/4 just two days ago. Cree Inc. (CREE) advanced 2.38 at 29.10. Sigma Designs (SIGM) jumped 1.73 on 4 million shares, closing at 22.11.
Shipping stocks were mixed, with TBS International (TBSI) up 1.48. However, DryShips (DRYS) was off 31 cent and Excel Maritime (EXM) off 7 cents.
Despite the fact that the advance-declines were substantially ahead on the exchanges, our board was somewhat mixed.
Other stocks of note, financial stocks were strong all day. Washington Mutual(WM), had a terfific day, up 1.87 on 71.8 million shares, closing at 11.70. FuelTek (FTEK) was up 1.14 today at 19.11, strong of late. RCH on another contract announcement gained 96 cents to 6.42
Portfolio position DCR, with oil being weak in morning, jumped at one point to 11.68, but backed off and gave back half of the gains, still closing up 53 cents on the day at 11.13.
Bear Stearns (BSC) gained 63 cents today on 48 million shares.
Other stocks of note, CIT Financial (CIT), which got hammered mid-day down to 6.45, worked its way back over 10, closing at 9.63, more than $3 off the session lows.
On the downside, there were no point-plus losers. Emcore (EMKR) fell 48 cents, Canadian Solar (CSIQ) 54 cents, Converted Organics (COIN) 63 cents, and Ascent Solar (ASTI) 28 cents.
But Solarfun (SOLF) managed to gain 31 cents and JA Solar (JASO) 20 cents in a mixed junior solar energy sector.
Stepping back and reviewing the hourly chart patterns, the indices held important support at today's lows near the moving averages on the hourly charts and held price support on the 5-minute and hourly charts as well, which gave the market an opportunity to rally, and they certainly did late in the day.
If you look at the formations on the hourly charts for the NDX and S&P, they certainly look like bottoming patterns may be forming here.
Next week we'll be closely watching important overhead resistance that if broken could confirm that a bottom has been put in. Those levels are in the 1770-75 zone on the Nasdaq 100 and then 1341-43 zone on the S&P 500, key levels that if broken convincingly, could set the stage for a stronger & longer rally phase.
Good trading!
Harry
