Quiet Before The Storm
Yesterday
was an apprehensive session on
NYSE volume of 1.1 billion shares, just over 80% of its average volume, with a
volume ratio of 70, and breadth at +443. The direction off the 870 .50
retracement level for the SPX
(
$SPX.X |
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PowerRating) remains up with the second day of
higher highs and higher lows. The Dow
(
$INDU |
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PowerRating) is bouncing from the Sept. 5
low of 8217 vs. its .50 retracement of 8305. The Nasdaq
(
$COMPQ |
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PowerRating) put in
an outside day with the close also in the top of its range. Scorecard numbers
yesterday read Dow +1.1%, SPX +1.0%, and Nasdaq +0.7%.
The early down yesterday
shook out some carryover position traders, and the contra-trend up-move started
right in a program zone on the 12:45 p.m. ET bar from a 1,2,3 higher bottom
pattern. If you passed that entry, don’t hate yourself because it was a listless
market minus any significant volume, and the futures had their way as the
Generals were quiet.
The
(
SMH |
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PowerRating)s bounced
4.4% off the 22.58 intraday low, trading up to 23.55, closing at 23.32, which
also gave traders setups in some of the other major semis. Our other major focus
sector, the biotechs, presented the better intraday setups, such as the
(
BBH |
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PowerRating)s and individual stocks such as
(
IDPH |
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PowerRating),
(
AMGN |
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PowerRating) and
(
CHIR |
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PowerRating), which are of course primary weightings in the BBH HOLDR.
As I said yesterday, the
futures will dominate unless the Generals participate, and there is enough
terrorist talk to make most back away for a few days until the air clears. The
SPX closed at 903, right at the 905 – 910 initial point-and-figure resistance,
and also the 909 20-day EMA. The 50-day EMA is at 927, and the head-and-shoulder
neckline at 930. Just below, there is the .618 retracement to yesterday’s 883
low of 892, with the .38 retracement from 965 – 776, which is 893.
As you know, the NYSE
opens for trading at 11:00 a.m. ET on Wednesday, and stocks are not the primary
focus of most people right now.Â
Have a good trading day.
Five-minute chart of
Monday’s SPX with 8-, 20-,
60- and 260-period
EMAs
Five-minute chart of
Monday’s NYSE TICKS