Closing Analysis

Down Session Tests Key Support RSS

Closing Technical Market Analysis for Thu March 22nd 2012

The stock market indices had another down day today. The S&P 500 dropped from 1414 down to 1389 over the last four sessions. It’s not a steep drop, but it was certainly testing key support around the 1390 range today, holding twice at 1389.

The day started out with a big gap down. They bounced back sharply, retested the lows, making lower lows on the S&P 500, but did not confirm on the Nasdaq 100. They rallied back midday to resistance to test the double-topping around 2738 NDX, but were unable to get over 1395 on the S&P 500. They then rolled over to test the lows. Late in the day when they were successful at testing those lows, they bounced back rather sharply to pare back the losses. Nevertheless, they ended the session down on the day.

Net on the day, the Dow was down 78.48 at 13,046.14, about 30 points off its low. The S&P 500 was down 10.11 to 1392.78, just 4 points off its low, and the Nasdaq 100 down 5.38 at 2731.50, about 12 points off its low.

Advance-declines were nearly 3 to 1 negative on the New York Stock Exchange, and 2 1/2 to 1 negative on Nasdaq. Up/down volume was 6 to 1 negative on New York, with total volume of 735 million shares traded today. Nasdaq traded just under 1.5 billion shares and had a 2 1/2 to 1 negative volume ratio. board, as a result, was mostly lower today, but there were some outstanding issues on both sides. Leading the way on the plus side, Shoe Carnival, Inc. (SCVL) jumped 5.61 to 32.11, or 21%, on strong earnings. MAP Pharmaceuticals, Inc. (MAPP) gained 1.61 to 16.77, or 10 1/2%, on 1.35 million shares. Convergys Corp. (CVG) ran up 1.31 to 14.02, or 10.3%, on 3.7 million shares. Tangoe, Inc. (TNGO) gained 1.56 to 19.13, or 8.88%, on 1.4 million shares.

Smith & Wesson Holding Corporation (SWHC), a very strong gun manufacturing group, was up 78 cents to 7.68, or 11%, on 6.2 million shares traded. Sturm, Ruger & Company, Inc. (RGR), also a gun manufacturing company, jumped 5.63 to 47.93, or 13%, on 1.2 million shares.

UTi Worldwide Inc. (UTIW) was up 1.04 to 17.04. Western Digital Corporation (WDC) had a big day, up 2.61 to 42.06. G-III Apparel Group, LTD. (GIII) ran 1.75 to 28.36, and Incyte Corporation (INCY) 1.02 to 19.55.

In addition, RailAmerica, Inc. (RA) rallied 1.17 to 21.94. Seagate Technology (STX) was up 1.22 to 27.93. Watson Pharmaceuticals, Inc. Co (WPI) 2.49 to 66.18, Dollar General (DG) 1.39 to 46.14 on strong earnings, and Lululemon Athletica Inc. (LULU) 1.88 to 75.95.

On the downside, Apple Inc. (AAPL) lost 3.16 to 599.34, after hitting 6.04 earlier in the day, but closed about 4 points off its low. Coinstar, Inc. (CSTR) was down 1.02 to 61.00 even. Goldman Sachs (GS) gave back 1.25 to 124.74. Netflix, Inc. (NFLX) lost 1.37 to 118.73. Rackspace Hosting, Inc (RAX) plummeted 1.86 to 55.94. SodaStream International Ltd. (SODA) lost 1.26 to 34.51.

The ultra-longs really got hammered today. Direxion Daily Financial Bull 3X Shares (FAS) was down 4.08 to 105.33, and the Direxion Daily Small Cap Bull 3X Shares (TNA) dropped 1.73 to 60.49.

Ultra-short VelocityShares Daily 2x VIX (TVIX) was down 4.23 to 10.20.

Stepping back and reviewing the chart patterns, the indices dropped three times down into the 2720 level on the NDX, and held all day, but still closed down on the session. The S&P 500 held twice at 1389, but we’ll have to see if that holds tomorrow.

Good Trading!


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