Closing Analysis

Indices Eek Out Gains on Late, Sharp Rally RSS

Closing Technical Market Analysis for Wed August 31st 2011

The stock market indices managed to eek out gains today after an early strong start, and then a strong 3-wave pullback that took the indices to the session lows with just half an hour to go. In the last 30-35 minutes or so, they rocketed back in what looked like short covering to put the indices back in the plus column.

Net on the day, the Dow was up 53.58 at 11,613.53, about 100 points off its high at the close, but about 90 points off its low. The S&P 500 was up 5.97 at 1218.89, and the Nasdaq 100 up 3.32 at 2241.01. However, the NDX traded 27 points higher at one point, although it did bounce 19 points off its low to close mid-range on the day.

Advance-declines were nearly 2 to 1 positive on the New York Stock Exchange, and dead-even flat on Nasdaq. Up/down volume was 2 1/2 to 1 positive on New York, with a total volume of about 1 1/4 billion shares traded. Nasdaq traded 1.875 billion shares and had about a 10 to 8 1/2 positive volume ratio. board was mixed, and most of the stocks were actually lower on the day. There were, however, a couple outstanding stocks today. Mitek Systems Inc. (MITK), which ran from 9.60 to as high as 11.30, closed at 10.95, up 1.30. A nice net gain there today of 13.6%, trading 1.3 million shares. That’s the biggest volume we’ve seen on MITK in a while.

Other stocks of note included Openwave Systems Inc. (OPWV) up 44 cents to 1.91, or 30%, on 8 million shares today. Hollysys Automation Technologies, Ltd (HOLI) was up 77 cents to 5.71, or 15.6%; Vera Bradley Designs, Inc. (VRA) 4.57 to 35.14, or 15%; SemGroup Corporation (SEMG) 2.23 to 22.94, or 10 1/2%; The Fresh Market, Inc. (TFM) 3.77 to 38.61, or 11%; Genetic Technologies Ltd. (GENE) 81 cents to 7.10, or 13%; Inc. (STMP) 1.68 to 19.64, or 9%; ADA-ES, Inc. (ADES) 1.45 to 15.19, or 10.5%; and Jos. A Bank Clothiers Inc. (JOSB) 4.03 to 51.30, or 8.5%, with Apricus Biosciences, Inc. (APRI) up 36 cents to 4.79, or 8.5% .

Other gainers of note included Dish Network Corp. (DISH) up 1.52 to 24.86, Zillow, Inc. (Z) 2.05 to 37.18, Smith & Nephew plc (SNN) 2.02 to 50.97, LSB Industries Inc. (LXU) 1.71 to 39.95, and EnerNOC, Inc. (ENOC) 74 cents to 12.44.

Other than that there weren't many other point gainers on board today.

On the downside today the Direxion Daily Financial Bear 3X Shares (FAZ) lost 1.73 to 51.29. Apple Inc. (AAPL) dropped 5.16 to 384.83. InterDigital, Inc. (IDCC) was down 2.08 to 70.40, Coffee Holding Co.Inc. (JVA) got hammered for 2.87 to 18.41, Molycorp, Inc. (MCP) fell 1.10 to 56.52, and Universal Display Corp. (PANL) gave back 1.84 to 49.06. SodaStream International Ltd. (SODA) was down another 1.11 to 35.45, Travelzoo Inc. (TZOO) down 1.49 to 36.52, and VirnetX Holding Corp (VHC) down 1.70 to 21.49.

Stepping back and reviewing the hourly chart patterns, the indices were up sharply early to new rally highs, and then pulled back in a 3-wave decline that took the NDX from 2268 down to 2222, a loss of 46 points, only to snap back 19 and close up on the day barely. The S&P 500 dropped back after the strong early morning rally from 1231 down to 1209, but snapped back to close at 1218 on the day.

Though it was a sloppy day for the indices, they did manage to hold support after breaking out early. So, we’ll have to see what happens tomorrow.

Good Trading!


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