Definitive Down-Day
By Harry Boxer, The Technical Trader (
www.thetechtrader.com)
The markets had a definitive down-day today. Starting with pre-market futures lower, the indices opened down, did snap back and try a decent morning rally that failed right at key overhead short-term resistance, and then sold off and made lower lows. But they failed to follow-through to the downside, testing key lateral support going back three weeks on the indices, held and then bounced in the last hour or so, but still ended up down on the day.
Net on the day the Dow was down 36, the S&P 500 down 7, the Nasdaq 100 down 14.70, and the Philadelphia Semiconductor Index (SOXX) down 10 today, or nearly 3 percent.
The technicals were negative on advance-decline by about 3 to 2 on New York and 4 to 3 on Nasdaq. Up/down volume was also negative by 2 to 1 on Nasdaq and about 3 to 2 on New York. Total volume was lighter. NYSE volume failed to reach 1.2 billion, and Nasdaq volume was just a little over 1.6 billion.
TheTechTrader.com board was extremely narrowly mixed today with very few point-plus gainers and losers. The only point-plus gainer was DryShips (DRYS), up 1.84.
On the downside, point-plus losers included Aluminum Corp. of China (ACH) down 1.30, China Finance Online (JRJC) down 1.36 and Sigma Designs (SIGM) down 1.03, along with Washington Mutual (WM), down 1.34 on news of a financing, dividend cuts, and layoffs.
Other gainers of note, solar energy play Ascent Solar (ASTI) gained 74 cents, Canadian Solar (CSIQ) 59 cents, Akeena Solar (AKNS) 20 cents, Solarfun (SOLF) up 41 cents, and Energy Conversion Devices (ENER) also up 30 cents in the generally firm junior solar group.
Other than that DCR snapped back 30 cents today on declining oil prices, and Chindex (CHDX) gained 32 cents.
On the downside, InterMune (ITMN) fell 55 cents, Jinpan International (JST) down 33 cents, Rambus (RMBS) down 50 cents, and China Natural Resources (CHNR) down 92 cents.
Stepping back and reviewing the hourly chart patterns, the indices declined today and failed to take out initial resistance but held key short-term support, so the trend is still a little bit in doubt. We're still within the rising up-channels off the early March lows, but have been unable to make any headway in the last couple days as the indices have moved into retracement/ profit-taking mode. With various cycle highs due and the stock market looking vulnerable here we are very cautious about our approach to the market and raised some cash today by eliminating some of our long positions.
Good trading!
Harry
