Harry's Closing Boxer Brief
Daily Technical Market Analysis
Mon Aug 29th 2005
Solid Snapback
By Harry Boxer, The Technical Trader (www.thetechtrader.com)
The market had a solid snapback session off of new lows that were set early on. The market did gap down on the Katrina hurricane news along with the resultant run in oil to over $70 a barrel. The futures were down but improved after the open. After a brief drop the indices rallied strongly. The indices got back up to Friday's rally highs in the morning and then went into a two-hour consolidation or flag pattern, which looked promising. Right around the lunch the market spiked up strongly and made higher highs, double-topping on the NDX but making even higher highs late in the session on the S&P and closing near the upper end of the day’s trading ranges.
Net on the day the Dow was up 65 3/4, the S&P 500 more than 8, the NDX up more than 12 1/2, and the SOX up 6 1/4, which certainly helped Nasdaq today.
The technicals were positive by 5 to 3 on advance-declines on New York and a little less than 3 to 2 on Nasdaq. Up/down volume, however, despite total volume being lighter at less than 1.2 billion on New York, the plurality was more than 2 to 1 on up/down volume. On Nasdaq, it was 3 1/2 to 1 positive, but total volume there was also lighter at 1 1/4 billion.
TheTechTrader.com board was active, with more advancers than decliners today. The action was led on the upside by Amylin Pharmaceuticals (AMLN), to a new multiyear high, up 1.89 on 7 million shares. Energy Conversion Devices (ENER), one of four favorites this year, was up another 1.28 to a new four-year high. A new stock we traded today, Global Industries (GLBL), closed up 1.38 on 4.4 million shares.
Other stocks of note, Spire Corp (SPIR) spiked up 63 cents, Vertex Pharmaceuticals (VRTX) up 48 cents, Netflix (NFLX) 75 cents, and Forward Industries (FORD) snapped back 79 cents.
In the alternative energy sector, Evergreen Solar (ESLR) was up 40 cents, and Distributed Energy Systems (DESC) up 16 cents.
In the larger-cap sector Broadcom (BRCM) advanced 88 cents, Genesis Microcap (GNSS) 72 cents, and Intel (INTC) 32 cents The SMH was up 50 cents and the QQQQ 30 cents.
Stepping back and reviewing the hourly chart patterns, the Nasdaq 100 went up to initial price resistance and took out the 21 and 40 day moving averages on the hourly charts, but fell short of the top of the current down channel. The S&P trailed a bit, rallied to resistance and backed off late in the session.
The levels we'll be watching tomorrow are the 1215-16 area on the S&P 500, and above that 1220, and the 1580 zone on the Nasdaq 100, the declining tops line, and then the all-important triple-top price resistance around 1589-90.
Good trading!
Harry
