Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Decisive Crack of Five-Week Uptrend

Stock-Markets / Stock Markets 2010 Aug 12, 2010 - 03:06 AM GMT

By: Harry_Boxer

Stock-Markets

Best Financial Markets Analysis ArticleThe stock market indices suffered a very negative setback today, with huge opening gaps to the downside. They then plunged to lower lows, and by mid-day reached their session lows on the Nasdaq 100. They attempted a snapback, which failed twice at resistance near 1850 NDX and 1094 S&P 500, and rolled over into the close with the SPX closing not far off the lows. The Dow was down as well. The Nasdaq 100 did fair a little bit better and closed about 7 points off its low, but still suffered a significant loss.


Net on the day, the Dow was down 265.42 at 10,378.83. The S&P 500 fell 31.59 at 1089.47, closing right at that 1088.90 key support zone. So tomorrow should be a very important day for the trend. The Nasdaq 100 was down 53.86 at 1845.38.

The technicals certainly confirmed the negative day, with declines leading advances by 6 to 1 on New York. Up/down volume was more than 30 to 1 negative, with a total of 1.150 billion shares traded. The vast majority of that, more than 95%, was to the downside.

Nasdaq was even worse with advance-declines at about 9 to 1 negative, and up/down volume nearly 22 to 1 negative. Total volume was a hefty 2 1/4 billion on Nasdaq.

Charts of the Day:

Today I'm going to cover some of the ultra-short ETFs that we've been trading over the last few weeks.

The Direxion Daily Emrg Mkts Bear 3X Shares (EDZ), which has been in a terrible decline, rallied in April and May, and came down in June. The June rally was not as strong as the BGZ, as the emerging markets didn't do as poorly. But then it went into a very neat, declining, orderly channel, with a 5-wave decline. It based out over the last several days, and then today gapped up, trading the heaviest volume in several weeks, and closing up 3.29, or 9.55%. Immediate goal would be to test and then take out the 38 1/2 area, which may be done tomorrow. We're at that level in the aftermarket. The declining topsline is around 40. The declining 50-day moving average is around 42, my initial trading target on a breakout. Secondary target is up around the 50-51 zone.

UltraPro Short S&P500 ProShares (SPXU), also in a falling wedge, broke out today with an 8.3% jump, up 2.46 on 7 1/3 million. It gapped up above the 10-day moving average, and broke above the 21. There's a minor target around 33 1/4 we expect may be reached tomorrow. The secondary target up around 35 3/4, and intermediate target up around 40 - 41.

IPath S&P 500 VIX Short-Term Futures ETN (VXX) has a falling wedge that was broken today as well. Not as big a thrust, up 7% or 1.53, but enough to say that I think we've broken the trend. Volume is picking up a little bit, and we could see a move that tests the 25-25 1/2 zone, my next trading target. Beyond that I'm looking at 28, possibly even as high as 32 - 33, if we get a real ugly market to the downside.

Reviewing our Watchboard:
TheTechTrader.com board was all negative, except for one stock and some of the ultra-short ETFs. That stock was portfolio position Netlist Inc. (NLST), which reported earnings after the close. It was up 7 cents at 3.05, just a few cents off its high for the day.

However, on the downside, multiple big-point losses included Cree Inc. (CREE), down 9.15 at 59.81, Apple Inc. (AAPL) 9.22 at 250.19, Google Inc. (GOOG) down nearly 12 at 491.74, Goldman Sachs (GS) 4.65 at 149.25, and Amazon.com Inc. (AMZN) down 4.11 at 125.89.

Other multiple-point losses were Transocean Ltd. (RIG) down 2.30 at 54.16, ADTRAN Inc. (ADTN) 1.51 at 30.21, Acme Packet, Inc. (APKT) 1.35 at 31.44, BP Exploration plc (BP) 1.32 at 38.79, Dendreon Corp. (DNDN) 1.74 at 36.90, OmniVision Technologies Inc. (OVTI) dropped 1.70 at 22, and Valassis Communications Inc. (VCI) 1.76 at 31.93.

There were several other point-plus losers, but too many to mention here.

On the plus side, the short ETFs, which are highlighted in our Charts of the Day video, had a stellar day as our day trade picks fared very well there. The Direxion Daily Emrg Mkts Bear 3X Shares (EDZ) was up 3.27 at 37.72, Direxion Daily Small Cap Bear 3X Shares (TZA) 3.68 at 35.75, iPath S&P 500 VIX Short-Term Futures ETN (VXX) 1.54 at 22.84, and Direxion Daily Financial Bear 3X Shares (FAZ) 1.37 at 14.98. In addition, the Direxion Daily Large Cap Bear 3X Shares (BGZ) advanced 1.16 at 14.92.

It was a very negative day on Wall Street, and a decisive crack of the recent 5-week uptrend. They closed right at key support levels near the 1840-45 zone on the NDX and the 1088-90 zone on the S&P 500.

Any downside follow-through tomorrow that cracks support could accelerate sharply, so it will be a very critical day to see how well the market fares and whether or not the downtrend is just beginning.Good trading!

Good Trading!

Harry

For more of Harry Boxer, sign up for a FREE 15-Day Trial to his Real-Time Technical Trading Diary. Or sign up for a Free 30-Day Trial to his Top Charts of the Week service.

(c) 2010 AdviceTrade, Inc. All rights reserved. Distributed only by written permission of AdviceTrade and The Technical Trader at info@advicetrade.com . In using any portion of Harry Boxer's content, you agree to the terms and conditions governing the use of the service as described in our disclaimer at http://www.thetechtrader.com

Mr. Boxer's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Boxer's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.

Harry Boxer Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in