Closing Analysis

Dramatic Sell-Off!

Closing Technical Market Analysis for Tue November 8th 2011

The stock market indices suffered dramatic steep losses with very negative technicals today. News from Europe, particularly Greece and Italy, hammered financials, and took the market down hard today.

The day started out with a big gap sharply lower to test key support. The indices held for about an hour and bounced sharply into mid-morning, consolidated, and then rolled over hard midday and came down sharply. They bounced in the last hour, or so, and then retested the lows, and bounced again in the last 10 minutes only to pull back in the last couple minutes to close deeply lower.

Net on the day, the Dow was down 389.24 at 11,780.94, the S&P 500 down 46.82 at 1229.10, and the Nasdaq 100 down 85.91 to 2314.10.

Advance-declines were about 10 to 1 negative with 283 up and 2769 down on the New York Stock Exchange, and Nasdaq was equally as bad with 324 up and 2230. Up/down volume was 15 million up and nearly 1.1 billion down on New York. Nasdaq had a negative volume ratio of nearly 20 to 1 with 111 million up and more than 2 billion down.

Those were climactic-type numbers today. board was vastly and steeply lower with Apple Inc. (AAPL) leading the way, down 10.95 to 395.28. A couple of our Boxer Shorts got destroyed today. Rovi Corporation (ROVI) got crushed for 17.79 to 28.23, Blue Nile Inc. (NILE) was down 15.99 to 32.82, losses of more than 30% on both of those stocks. Northern Oil and Gas, Inc. (NOG) was down 4.23 to 22.62 after releasing its earnings report.

Weight Watchers International, Inc. (WTW), also a Boxer Short, dropped 7.17 to 64.67.

Goldman Sachs (GS) fell 8.91 to 99.67, International Business Machines Corp. (IBM) 5.01 to 182.24, Golar LNG Ltd. (GLNG) 2.75 to 27.67, First Solar, Inc. (FSLR) 2.57 to 44.98, MAKO Surgical Corp. (MAKO) 2.51 to 33.34, Molycorp, Inc. (MCP) 2.66 to 39.63, and Netflix, Inc. (NFLX) 2.42 to 88.05.

The Direxion Daily Small Cap Bull 3X Shares (TNA) lost 7.11 to 42.91.

On the upside, the ultra-shorts had a great day. The VelocityShares Daily 2x VIX ST ETN (TVIX), a stock we traded today, was up 17.20 to 63.24. The Direxion Daily Small Cap Bear 3X Shares (TZA) was up 4.03 to 32.25, the Direxion Daily Financial Bear 3X Shares (FAZ) 5.65 to 43.40, and the Direxion Daily Large Cap Bear 3X Shares (BGZ) 3.36 to 33.42.

The only stock on the board that had a significant gain today was SodaStream International Ltd. (SODA), up 1.92 to 36.03 on earnings.

In after hours, Green Mountain Coffee Roasters Inc. (GMCR) plunged on earnings. It was down 3.28 to 67.02 at the close of today, and went from 67 to the mid-40s in the aftermarket.

Low-priced KIT digital, Inc. (KITD) was up 2.85 to 11.21, or 34%, on 5.7 million shares. That was a big percentage gainer for that stock.

Stepping back and reviewing the hourly chart patterns, the indices gapped down hard in the morning, and came down harder in the afternoon with a bounce in the last half hour. But, still, it was a very steep negative day today as key support and trend line support were taken out. It doesn’t look well for future appreciation, and, in fact, if support at the 1215-20 zone on the S&P 500 is taken out, we can see steeply lower levels.

Good Trading!


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- Harry Boxer

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