Why Today Is Important…
The Dow Jones Industrial Average
(
$INDU |
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PowerRating) and
Nasdaq Composite
(
$COMPQ |
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a rally today. Technology stocks are hampering the markets today. The very
important Phlx Semiconductor Index
(
$SOX.X |
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PowerRating) has fallen below the 500
level. The drawdown in tech has to do with persistent worries about the
strength of corporate tech spending. These concerns were fueled by reports that
International Business Machines
(
IBM |
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PowerRating) plans to lay off as many as
8,000 workers, or 2.5% of its employees worldwide — its widest staff cuts
since the early 1990s.
Key support for the Dow was at 10,000, but if the
Dow closes below this level, it will become resistance. The initial resistance is
at 10,142, the 38.2% retracement level. The Nasdaq has support at 1600 and
overhead resistance at 1650.
What happens in today’s market will let us know
if this past week’s Wednesday rally was a fluke or not. Tony Saliba has a nice
take on this.
Click here for Saliba’s Options Views.
June crude oil
(
CLM2 |
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PowerRating) is trading at
more than $28 a barrel, which is making the PHLX Oil Service sector
(
$OSX.X |
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PowerRating) the best performing sector on the day so far.
June gold
(
GCM2 |
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PowerRating)
has had an active trading range, opening at 308.30 and going as high as 311.80.
Gold futures have a tendency to influence the movement of gold stocks. A
positive move in gold today could have the Phlx
Gold & Silver Index
(
$XAU.X |
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PowerRating) and some of the gold mining stocks
turning positive. Some of those stocks include Anglogold
(
AU |
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PowerRating), Barrick
Gold
(
ABX |
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PowerRating), Newmont Mining
(
NEM |
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PowerRating) and Placer Dome
(
PDG |
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PowerRating).
Treasuries are also stronger. Traders are putting
money into bonds instead of equities today. The June 30 year bond
(
USM2 |
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PowerRating) and June 10 year note
(
TYM2 |
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PowerRating).
Adobe
(
ADBE |
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PowerRating) retouches 50-day MA.
ADBE is also touching the 10-, 20- and 30-day MA. This level on the daily
could provide for a small bounce and in fact, intraday, a little bounce is
developing. If ADBE can make its way up to the $39.50 area, it should
start hitting some resistance. Nimble intraday traders may want to watch for
some failure at that area and a possible short setup.
Laboratory Corp of
America Holdings
(
LH |
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Chart |
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PowerRating) is rallying from a pullback from the high. LH has
a TradingMarkets.com RS3 rating of 80.
NYSE Adv/Dec 1140/1901 Nasdaq Adv/Dec 1185/2087.