Decisive Down-Day
By Harry Boxer, The Technical Trader (
www.thetechtrader.com)
The market started out with some positive action in the morning. But despite the fact that the Nasdaq 100 reached over 2000 for the first time in four months, the S&P 500 was not able to reach new highs and confirm, and they rolled over hard in the morning, bounced mid-day, and then really sold off sharply and steadily in the afternoon, and closed near the lows for the day.
The Dow was down 206 1/2, the S&P 500 down 25.70 and the Nasdaq 100 down more than 39 and the Philadelphia Semiconductor Index (SOXX) closed down 5.50.
The technicals confirmed the negative day, by 3 to 1 on decliners over advancers on New York and 2 1/2 to 1 on Nasdaq. Up/down volume was a lot worse, more than 5 to 1 negative on New York on total volume of less than 1 1/4 billion. Nasdaq, however, traded more than 2 1/4 billion and had a better than 4 1/2 to 1 negative ratio.
So, it was a decisive down-day today and they closed near the lows for the day going away.
TheTechTrader.com board reflected that with the vast majority of stocks to the downside, many of them multiple-point losers. Leading the way today was VMware (VMW) , down 3.63, and Canadian Solar (CSIQ) , which despite making a new all-time high this morning at 32.85, reversed 4 1/2 points and closed down 3.07 on the day on 3 1/2 million shares.
Also in that solar group, JA Solar (JASO) fell 1.75, Solarfun (SOLF) 37 cents, TSL 2.04 and Energy Conversion Devices (ENER) 1.19.
Shippers also took it on the chin. DryShips (DRYS) dropped 5 points late in the afternoon and closed down 2.66 on the day, reaching near 96 before reversing, closing at 90.12. Excel Maritime (EXM) lost 2.09 and TBS International (TBSI) 1.18.
Chinese stocks had a difficult session. China Finance Online (JRJC) fell 2.34, China Natural Resources (CHNR) 1.89, Chindex (CHDX) 1.43, and Home Inns & Hotels (HMIN) lost 1.35.
On the plus side, multiple-point gainers included recent Chart of the Week GenCorp (GENC) up 1.85, and ON Semiconductor (ONNN) up 1.59 to 9.40 on 59 million on an excellent earnings report and upward guidance. Yesterday's Chart of the Day General Steel (GSI) gained 63 cents to 11.92, and Ceragon Networks (CRNT) at 10.51 was up 1.26, added today to our portfolio.
Stepping back and reviewing the hourly chart patterns, not much can be said other than we made nominal new highs on the NDX, not confirmed by the S&P 500, and then a deep slide took them down sharply to price and moving average support, closing right near the trendline support of the last 2 1/2 weeks. So another key session tomorrow. If they follow through to the downside from here, the back of the recent multi week rally will potentially be broken. KEY support around 1380-83 zone on the S&P 500 and near the 1915-25 zone on the Nasdaq 100 will be watched carefully.
Good trading!
Harry
