Harry's Closing Boxer Brief
Daily Technical Market Analysis
Mon Jul 18th 2005
Beginning of a New Pullback?
By Harry Boxer, The Technical Trader (www.thetechtrader.com)
We had a negative day as we expected after options expired. The session started with the futures being lower before the opening, and the stock market indeed opened lower and went down right to support. The indices held, snapped back to resistance, failed and pulled back and retested. In the afternoon the market moved in a very narrow, coil-type range, but since this pattern comes off of move down it can be considered a bearish pennant pattern.
In several cases, the indices did hold support at around the 1570 on the NDX and 1222 on the S&P. At the end of the day, though, when a last-hour rally failed, they rolled over and closed at or near the lows for the day going away.
Net on the day the Dow was down nearly 66, the S&P was down 6 3/4, the Nasdaq 100 was down 7 3/4, and the SOX was down about 2.80, pressuring Nadsaq today.
Technicals were negative by 3 to 2 on both exchanges on advance-declines and more than 2 to 1 on both exchanges on up/down volume. Total volume on New York was lighter at less than 1.2 billion and Nasdaq traded about 1 1/4 billion.
So, fairly light volume today, but there was some exciting action on TheTechTrader.com board. Leading the way on a follow up to last week's tremendous surge was Host America (CAFE), which soared to over 15 but closed at around 14, up 3.87 on 32 1/2 million shares, more than 10 times the stock's float.
Former Chart of the Week and a TheTechTrader.com favorite, DayStar Technologies (DSTI), hit an all-time high today, closing at 17.30, up 2.42 on 3.2 million, heavy volume there again for that stock.
Internet Initiative Japan (IIJI) exploded and took out recent rally highs and closed up 1.77 on 8 1/4 million shares, also very heavy volume.
Forward Industries (FORD) snapped back by 74 cents, and CryptoLogic (CRYP) gained 69 cents.
A new one we're following, ArQule (ARQL), a biotech stock, advanced 89 cents today, but that was about 80 cents off the high.
Click here.
Stepping back and reviewing the overall hourly chart patterns, the indices bent hard today, didn't quite break until the very end of the session, but the S&P 500 managed to close below its rising 40-day moving average on the hourly charts. The Nasdaq 100 managed to close below the 21-day moving average on its hourly charts.
So it's possible we've seen the beginning of a new pullback we've been expecting for a few days now, and we'll see if we get a follow-through tomorrow morning.
Good trading!
Harry
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