The indices continued to move lower Tuesday, following up to the action late Friday and Monday. We’ve now had back-to-back downdays to start the week. We’d anticipated that, but also think the market’s headed even lower.
The day started out with a gap down. A sharp move lower ensured, and then the indices stabilized in the 1588-90 zone the Nasdaq 100 and near 992-93 zone on S&P 500. They did try to stage an afternoon rally, and were the near the afternoon rally highs with about 15 minutes to go when they suddenly rolled over and plunged hard to take back some of those gains and close lower on the day.
Net on the day the Dow was down 96.50 to 9241.45, the S&P 500 down 12.75 at 994.35, and the Nasdaq 100 down 15.74 at 1594.69.
Advance-declines were decidedly negative by nearly 3 to 1 on New York and by about 2 ½ to 1 on Nasdaq. Up/down volume was 4 ½ to 1 negative on New York on total volume of just under 1.2 billion. Nasdaq traded about 1.9 billion and had about a 3 ½ to 1 negative volume ratio.
TheTechTrader.com board as a result was mostly negative, though there were a few outstanding issues. Brigham Exploration (BEXP) on positive drilling exploration news ran up to 7.35, a new 2009 high, nearly triple its low of just 4 weeks ago. It closed at 6.68, still up 74 cents on 6.8 million shares, heavy volume for that stock.
Human Genome Sciences (HGSI), after being upgraded to a $30 target pre-market, jumped to 16.81, reaching as high as 17-plus pre-market, but backed off to close at 15.76, still up 86 cents on 17 million shares.
Jazz Pharmaceuticals (JAZZ), a portfolio position, closed at 6.52 up 42 cents, but was trading sharply higher in the aftermarket at 7.70 on very positive sales and earnings news.
Ultrashorts had a big day today, with the Direxion Financial Bear 3x Shares (FAZ) up 2.45 to 28.21 and the Direxion Large Cap Bear 3X Shares (BGZ) up 92 cents at 26.64. Portfolio position Direxion Small Cap 3x Bear (TZA) up 73 cents to 15.78 and the UltraShort Real Estate ProShares (SRS), also a portfolio position, up 67 cents to 12.31.
Direxion Financial Bull 3x Shares (FAS) got slammed for 7.09 to 67.54, and the iShares MSCI Brazil Index ETF (EWZ) was down 1.30 to 59.51.
Wells Fargo (WFC) lost 1.75 to 26.89. JP Morgan (JPM) gave back 1.45 at 41.24, Goldman Sachs (GS) 1.14 to 159.22, and Morgan Stanley (MS) 94 cents to 29.89, as financials led the way lower today.
Stepping back and reviewing the hourly chart patterns, the indices were down in the morning, flat mid-day, and rallied back in the afternoon, but rolled over in the last 15-20 minutes to close negative for the day. However, the SPX has still not broken key support around the 990-92 zone. We’ll see if that holds tomorrow or finally breaks and confirms new pullback lows on the NDX.
Good trading!
Harry
