Where The Selling May End…
After the US markets took a day off to
acknowledge the Labor Day holiday, they are being pushed lower due to
several factors having to due with the global economy. First, overnight, Japan’s
Nikkei fell to its lowest level in 19 years after losing 3.2% in trading. In
Italy, consumer confidence fell to a three-year low. And third was the weaker
than expected ISM Index for August. This has raised concerns among traders and
has them renewing talk about a double-dip recession in the US economy.
Very few sectors are performing positive today.
The two that are trading positive are Gold
(
$XAU.X |
Quote |
Chart |
News |
PowerRating) and Trucking.
Consolidated Freightways announced that it is
Filing Chapter 11 and will be going out of business. This has helped several
trucking companies move higher in anticipation of capturing a bigger market
share. Roadway Corp.
(
ROAD |
Quote |
Chart |
News |
PowerRating), Yellow Corporation
(
YELL |
Quote |
Chart |
News |
PowerRating)
and USFreightways
(
USFC |
Quote |
Chart |
News |
PowerRating) are all trading stronger on the day.
Dec. gold
(
GCZ2 |
Quote |
Chart |
News |
PowerRating) opened at $313.80.
Right now gold is trading higher on the day. Dec. gold has influence on the
movement of gold stocks. Example: If Dec. gold moves higher today, we could see
a possible move to the upside in gold stocks and the
Phlx Gold
& Silver Index
(
$XAU |
Quote |
Chart |
News |
PowerRating). Some of those stocks include
Anglogold
(
AU |
Quote |
Chart |
News |
PowerRating), Barrick Gold
(
ABX |
Quote |
Chart |
News |
PowerRating), Newmont Mining
(
NEM |
Quote |
Chart |
News |
PowerRating) and
Placer Dome
(
PDG |
Quote |
Chart |
News |
PowerRating). Dec. gold is trading at $315.50 an ounce, up 1.60.
Support is at 310.00.
The weaker sectors thus far are Banks
(
$BTK.X |
Quote |
Chart |
News |
PowerRating),
Semiconductors
(
$SOX.X |
Quote |
Chart |
News |
PowerRating) (close to a one-year low of 282.75),
Airlines
(
$XAL.X |
Quote |
Chart |
News |
PowerRating), Drugs
(
$DRG.X |
Quote |
Chart |
News |
PowerRating), Oil
(
$XOI.X |
Quote |
Chart |
News |
PowerRating)
and Biotech
(
$BTK.X |
Quote |
Chart |
News |
PowerRating).
The Nasdaq Composite Index
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) is trading right around the 61.8% retracement from the previous move
to the upside. Today’s resistance is at 1296/1300 with the secondary
resistance at 1312/1315. Support is at 1268/1265.
The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) fell to its
-2.0 Volatility Band (888) and at the day’s midpoint is trying to reverse up from
these levels. Overhead resistance is 896 and the 888 level is support.
Millipore
(
MIL |
Quote |
Chart |
News |
PowerRating) is pulling back to the
20-day moving average. MIL holds a
3-month
relative strength rank of 80 from TradingMarkets.com.
Lear Corporation
(
LEA |
Quote |
Chart |
News |
PowerRating)
is pulling back to test its 20-day moving average (45.53). Lear has a
TradingMarkets.com RS3 rating of 88 and an uptrending of
ADX
24.
Inter-Tel
Incorporated
(
INTL |
Quote |
Chart |
News |
PowerRating) is pulling back from its recent high to test its
20-day moving average (22.92). INTL has a
TradingMarkets.com RS3 rating of 98 and an uptrending
ADX of 31.Â
Accredo Health
(
ACDO |
Quote |
Chart |
News |
PowerRating) is starting to come
out of the pullback from high we profiled Friday. ACDO is carrying a
3-month
relative strength rank of 88 from TradingMarkets.com.
Breadth is negative today with NYSE and Nasdaq
decliners leading advancers by almost 4-to-1. Volume is stronger than last
week’s
levels at this time.