This Rising Sector Is Defying The Pullback
Traders are taking a cautious approach prior
to the FOMC meeting. The Fed will meet tomorrow, and if there is a change in
interest rates, we will hear it on Wednesday. In addition, there are a
slough of economic reports coming out during the week.
Bumpy trading has hit the market averages at
this hour after the strong opening. Within the last two hours, the averages have
wiped out all of the early gains. Computer-hardware, Semiconductors, and
Software have fallen off of their intraday highs, but are still in positive
territory.
The Nasdaq Composite
(
$COMPQ |
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PowerRating) is
testing resistance at 1950/1955. On a break above this level, look for
resistance at 1960/1967, which is the 50-day simple moving average. It is also a
38% retrenchment of the index. On a break lower, look for subsequent support at
1920. A break below this support level could lead to a pullback to around 1870.
One blemish for the market is the biotech sector
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$BTK.X |
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PowerRating)
which is nearing its pullback low established this month. This
sector continues to fall below support levels. Today it has fallen 15.32 points
to 512.25.
One sector that has displayed strength today is
wireless telecom
(
$YLS.X |
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PowerRating). Its currently up .04 to 84.88. The
telecom sector has bounced up off of its support level at 80 and its overhead
resistance is about 86.00. Shares of Nokia
(
NOK |
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sector higher.
Microsoft
(
MSFT |
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after hitting the 64.00 area earlier. On the downside look for initial
support at 63.50. If MSFT moves higher and breaks through its resistance at
64.00, it could move to 64.50, which is followed by the overhead resistance of
its 200-day simple moving average at 64.87.
Novellus Systems
(
NVLS |
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PowerRating) has cleared
its resistance in the range of 40.50. To the upside, look for intraday
resistance just over 41.50, with more overhead resistance at around 42.30. To
the downside, there is a break below initial support at 40.80. Novellus is
currently higher at 41.24, up .88.
Siebel Systems (SEBL)
is pulling back from its high of two days ago. SEBL is currently down 1.05
to 36.15 and is holding a 3-month
relative strength rank of 98 from TradingMarkets.com.
Vimpel Communications (VIP)
is pulling back from its recent high. VIP is down 0.56 to 30.28 and is
holding a 3-month
relative strength rank of 95 with an uptrending ADX of 44 from
TradingMarkets.com.
H&R Block (HRB)
is beginning to pull back after a move to the upside. HRB is now down 0.05
to 46.31 and is holding a 3-month
relative strength of 86 along with an uptrending ADX of 36 from
TradingMarkets.com.
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Crossing Above Their 50-Day Exponential Moving Average on Double Volume