Rebalancing Means Slim Jims

  • September 15, 2000
  • Kevin Haggerty

The
QQQs opened at 95 1/4, +1.9% from the previous close of 93 1/2. All
of the momentum stocks were green early as they were run up in Instinet
pre-opening.


The early hype was it for
the day, as the highs were hit by 11:00 a.m. and the Nasdaq 100
(
NDX |
Quote |
Chart |
News |
PowerRating)
trended down for the rest of the session.


The S&P 500 hit its
high by 10:00 a.m., trended lower all day, hitting its low of 1476.75 on the 3:40
p.m. bar. 


There were triple-witch activities all day, in addition to the S&P
500 quarterly rebalancing with the S&P 500 weightings
changing.


That’s why you were seeing
such irregular action in the various stocks, as the Generals add to or delete
from their current positions.  


It
is especially exaggerated in the higher-priced stocks because of the thinner
liquidity.


Today being triple-witch
expiration means you should be reacting from your intraday charts and be alert
for some explosive Slim Jims.


The S&P 500 closed at
1480.84, just below its 50-day EMA of 1483.11, which becomes your pivot point
today. 


Both the S&P 500 and NDX 100 closed at the bottom of their ranges,
but as I said yesterday, you don’t know who is really driving the bus and won’t
until expiration and rebalancing are completed.


So just sit
back and take the trades that are given to you on the intraday charts due to the
institutional agendas. 


There can be airpockets next week in some of the momentum
stocks that are affected by the weightings changes.














face=”arial, helvetica”>(December Futures)


Fair
Value

size=2>Buy

size=2>Sell


22.60


23.95

21.40


Pattern
Setups



(
GE |
Quote |
Chart |
News |
PowerRating),
(
AIG |
Quote |
Chart |
News |
PowerRating),
(
PVN |
Quote |
Chart |
News |
PowerRating),
(
PEB |
Quote |
Chart |
News |
PowerRating),
(
IDTI |
Quote |
Chart |
News |
PowerRating),
(
BRCD |
Quote |
Chart |
News |
PowerRating),
(
MERQ |
Quote |
Chart |
News |
PowerRating) and
(
VRTS |
Quote |
Chart |
News |
PowerRating).


Also look for intraday setups in the
major momentum stocks like
(
AMCC |
Quote |
Chart |
News |
PowerRating),
(
ARBA |
Quote |
Chart |
News |
PowerRating),
(
CIEN |
Quote |
Chart |
News |
PowerRating),
(
JNPR |
Quote |
Chart |
News |
PowerRating),
(
NTAP |
Quote |
Chart |
News |
PowerRating),
(
SEBL |
Quote |
Chart |
News |
PowerRating),
(
JDSU |
Quote |
Chart |
News |
PowerRating),
(
VRSN |
Quote |
Chart |
News |
PowerRating) and
(
NEWP |
Quote |
Chart |
News |
PowerRating).


Have a good trading day and a better
weekend.


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