The stock market indices had a volatile day today with five or six different whips back and forth. The day started out with a sharp move down testing support. They rallied sharply to test the highs, but couldn’t get through, and then came down even sharper, taking out the morning lows and taking out two-day lows. A very severely oversold intraday condition ensued, where the tick got to nearly -1500. At that point they staged a 3-wave rally over the next couple hours and moved back up to the upper end of the range, but then pulled back to close negatively on the session.
Net on the day, the Dow was down 76.97 at 11,405.93, the S&P 500 down 11.73 to 1192.76, and the Nasdaq 100 down 19.85 to 2194.27.
Advance-declines were about 3 to 1 negative on the New York Stock Exchange, and a little worse than that on Nasdaq.
Up/down volume was 4 1/2 to 1 negative on New York with total volume of just over 1.1 billion. Nasdaq traded just under 2 billion, and had about a 3 to 1 negative ratio.
So, technicals were decidedly negative today.
On TheTechTrader.com board, as a result, the majority of the stocks down today. Several of them were down sharply. Leading the way on the downside today was SodaStream International Ltd. (SODA), which got hammered for 11.72 to 38.63 on negative comments from Cramer. Goldman Sachs (GS) was down 2.26 to 116.87, Apple Inc. (AAPL) 2.93 to 380.48, International Business Machines Corp. (IBM) 1.75 to 171.24. Travelzoo Inc. (TZOO) 3.01 to 41.60, and Youku.com Inc (YOKU) 2.11 to 23.92.
The Direxion Daily Small Cap Bull 3X Shares (TNA) lost 2.72 to 46.12.
However, on the plus side, ultra-short ETFs had a good day. The Direxion Daily Small Cap Bear 3X Shares (TZA) was up 2.55 to 47.09, the Direxion Daily Financial Bear 3X Shares (FAZ) gained 2.46 to 58.00, and the Direxion Daily Large Cap Bear 3X Shares (BGZ) was up 1.23 to 42.50.
Among the individual issues we follow, MAKO Surgical Corp. (MAKO) was up 78 cents to 32.60, or about 2 points off its low.
Stepping back and reviewing the hourly chart patterns, the indices were down in the morning, up midday, and then sold off sharply early afternoon. They came on in a 3-wave advance to press near the session highs with about 15-20 minutes to go, and then they rolled over and backed off to extend some of the early losses.
Nevertheless, it was a solid day for the indices. We’ll see how it goes tomorrow, but today could have been a topping pattern as head-and-shoulder patterns are developing in this range. It will be interesting to see what kind of follow-through they get.
Good Trading!
Harry
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