Closing Technical Market Comments for Mon Sep 11, 2006
Semiconductors Spur Nasdaq
By Harry Boxer, TheTechTrader.com (www.thetechtrader.com)
The indices had a nominal upday today, particularly on the blue chips where the Dow was up only 5 and the S&P 500 up two-thirds of a point. The story today was the Philadelphia Semiconductor Index (SOXX), which gained more than 2 percent, up 10.34, and helped push the Nasdaq 100 up 9.07 today. But even those numbers were off the mid-afternoon highs.
The day started out with a gap down as pre-market futures were moderately lower. After a bounce they made lower lows, and actually nominally took out Thursday’s lows, but when there was no follow-through to the downside, they staged a strong rally that lasted 3 hours, taking the NDX up 33 points and the S&P nearly 11 points. They peaked for the session in mid-afternoon, with the NDX sticking its head out over 1590 and the S&P over 1302, but they pulled back to retest key support that held and bounced again late in the session.
However, the breadth was poor today for an up-day. NYSE advance-declines were 17 to 14 negative. Nasdaq was 16 to 13 negative. Up/down volume was 9 to 7 negative on New York, with nearly 1 2/3 billion traded. Nasdaq traded a very similar amount, but had a 9 ½ to 7 positive plurality on advancing over declining volume.
TheTechTrader.com board was very narrowly mixed with a few outstanding gainers and losers. On the plus side, Akamai (AKAM) broke out to a new 6-year high, gained 2.24 on nearly 7 million shares. Metrologic Instruments (MTLG), which we’ve mentioned recently, gained 1.31, and other than that there were no point-plus gainers on our board.
Among other gainers, Energy Conversion Devices (ENER) advanced 64 cents, GIGM 68 cents, Rambus (RMBS) 50 cents, and RadioShack (RSH) up 47 cents.
On the downside, Dynamic Materials Corp. (BOOM) lost 1.77 and DXP Enterprises (DXPE) 1.32, the only point-plus losers.
Other stocks on the downside, Fuel Tech (FTEK) lost 69 cents, Nu Horizons Electronics (NUHC) 98 cents and Viropharma (VPHM) 53 cents.
Stepping back and reviewing the hourly chart patterns, the key to today’s session was that the Nasdaq 100 popped strongly mid-day, took out 5-day declining tops resistance, and important short-term price resistance at 1580, reaching as high as 1591 before backing off and retesting the 1580 support level.
The S&P 500, however, however did not confirm on the hourly charts. It failed near key overhead resistance at 1302 as well as its declining 40-day moving average resistance on the hourly charts before backing off in the last hour.
The next day or so should yield clues as to which way they want to follow through. A strong follow-through to the upside could mean a retest of the highs or better, while failure to do so could mean a retest of the lows or worse. Stay tuned...
Good trading!
Harry
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