By Harry Boxer, The Technical Trader
The indices ended with a plus day to start the week, which was different than we've seen of late. Today the indices started out strongly and within an hour were at the session highs and secondary key formidable resistance near the 1200-02 zone on the Nasdaq 100 and the 850-55 zone on the S&P 500. They failed to break through, backed off and backed and filled in what looked like orderly and potentially bullish consolidation patterns, in anticipation of a late morning or afternoon rally try, but when that did not materialize, they rolled over rather hard by mid-day. After lunch they clawed their way back to secondary resistance but failed and rolled back into the close and bounced.
Net on the day the Dow was up just 38.47, the S&P 500 4.62, the Nasdaq 100 8.67, and the Philadelphia Semiconductor Index (SOXX) up 1.61.
The technicals were also positive by a little less than 2 to 1 on advance-declines on New York and by about 5 to 3 on Nasdaq. Up/down volume was 7 to 5 positive on New York on total volume of about 1 1/4 billion. Nasdaq traded over 1.85 billion and had a 2 to 1 positive volume ratio.
TheTechTrader.com board was mixed but generally higher with narrow moves. Leading the way were the agriculture stocks. Potash (POT) was up 2.20, Mosaic (MOS) 1.14, Agrium (AGU) 65 cents, and CF Holdings (CF) 43 cents.
Biotech/stemcell stock Geron (GERN) had a terrific session, up another 1.06, on 29 million shares, closing at 8.15. Apple (AAPL) was up 1.28, the Direxion Financial Bear 3x Shares (FAZ) jumped 2.56, despite the market gains, because most of the banking stocks came way off their highs.
For example, Bank of America (BAC) was near 7 in the morning, but closed at 6, down 24 cents, reversing a full dollar on 265 million. Morgan Stanley (MS), likewise, jumped to 20.70, and closed at 19.08, up only 37 cents. JP Morgan (JPM) backed off 1 1/2, and closed at 24.50, up only 22 cents today. Citigroup (C) gave back 40 cents from its high, and closed down 14 cents on the day, on 211 million shares
On the downside, Research in Motion (RIMM) lost 1.93, SunPower (SPWR) down 1.46, and Direxion Large Cap Bear 3X Shares (BGZ) lost 1.18. Those were the only point-plus losers.
Stepping back and reviewing the hourly chart patterns, the indices were up early, down mid-day, and back up in the afternoon to close positive on the session to start the week, and maintaining their price and moving average support on the hourly charts.
So if anything can be taken away as a positive today, it's that trendline, price and moving average support did hold during the afternoon slide. We'll see if we can get a follow-through to the upside and take out key overhead resistance. Again, the levels we'll be watching are 1200-02 NDX and the 850-52 zone on the S&P 500.
Good trading!
Harry
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