The Catalyst For Your First-Hour Strategies
The SPX
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closed at 920.27, -1% on the day and down 2.1% since the 939.61 high
on Tuesday. It reversed the last three lows and four closes and also closed just
below yesterday’s 1.0 volatility band. The Dow
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above its 200-day EMA at 8484, so we have a pivot point in play again.
The QQQs
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closed at 27.82, -1.7%, and have declined 3.9% from its from its 2.0 six-month
standard deviation band. The close was also a three-bar reversal down. The SMHs
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which have also made it to the +2.0 band level, finished the day at 26.83, -2.3%
and -5.7% high to low from the Tuesday high.
NYSE volume was 1.3 billion, volume ratio 27 and breadth -351. The Nasdaq’s
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volume ratio was just 18 versus 26 yesterday so some of that tech froth is unwinding. The Nasdaq Composite closed at 1490 with a 20-day EMA below at 1457 and a
support level at 1425-1430 level with the 200-day EMA down at 1418.
The major indices have reached an extended level and a previous rally high of
935 for the SPX, so we are not surprised that they are backing off some. See the
May 5 and
May 6 commentary.
I would like to see the major indices retrace to the breakout levels and we
will find out very quickly if the Generals intend to stay with this move. In
addition to the semis, all the major sectors were red, except for the XAU
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$XAU.X |
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is the gold index, which was +2.8%. Within that circle, crude oil was +2.9% and the US dollar
was -0.8%, with the
30-year bond up slightly.
The XBD, which is the broker index, has been
strong with the semis, was -2.5% yesterday helped in part by the bureaucrats in
Washington. The openings in the index proxies were soft and discounted enough
to give us some trap Doors. The SPY rallied to the 240 EMA at the 93.33 intraday
high from the signal bar low of 92.41 with entry above 92.64. Not great,
but something.
A symmetrical triangle formed from 10:30 to 11:45, which provided a breakout
below all of the 8, 20, 60 and 240 EMAs. Entry was below 92.92 and it carried down to an intraday low of 92.41, then
went sideways at the lows for the afternoon closing at 92.34. Not a great
trading day by any shakes, but let’s hope they never do away with the futures
that are the catalyst for all of our first-hour strategies.
There are no significant intraday threads this morning on the screens,
but some
of the Biotechs like Amgen
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are pulling back to levels where they should be on your intraday scroll list.
Have a good trading day and have a great weekend.
Kevin Haggerty
Five-minute chart of
Thursday’s SPX with 8-, 20-,
60- and 260-period
EMAs
Five-minute chart of
Thursday’s NYSE TICKS