Harry Boxer's Technical Trading Diary: Breaking Higher!
Friday, April 2, 2004
By Harry Boxer, The Technical Trader
(www.thetechtrader.com)
The market had a phenomenal day and a very, very strong close to the week, but the underlying technicals, particularly on the New York Stock Exchange were not impressive. We’ll talk about that in a minute.
The day started out with a fantastic jobs report, the best gains in four years, and the market loved it. The Nasdaq gapped up nearly 30 points, the S&P jumped about 10. At that point we got some profit-taking. The market pulled back to initial support, then held and went on to secondary highs on the Nasdaq 100 but failed to do so on the S&P 500 and Dow. When that happened, the market came down and retested on the S&P 500 and made a higher low on the Nasdaq. In the last hour they firmed up again into the close. They closed near the highs for the day on the Nasdaq but off the highs on the Dow and S&P. Still, at the end of the day, they were up 97 on the Dow, about 9 ½ on the S&P, 37 on the Nasdaq 100 and 42 on the Composite. The Sox had a tremendous day, up 18.54, or about 3 ½ percent, on the report of global chip sales up 31%.
Reviewing the technicals, the advance-declines on New York were only positive by about 160 issues. Pretty narrow for a day where the Dow is up nearly 100 and the S&P was up nearly 100. But the up/down volume was about 2 to 1 positive, with a total of about 1.6 billion traded. On Nasdaq it was much better, with 22 to 10 advance-declines. Up/down volume was about 5 ½ to 1 on Nasdaq, with 1.85 billion up and 278 million down. Total volume there was heavy at nearly 2.2 billion. My personal board had mostly gainers. There were a few fractional losers, particularly in the nanotech area that had a strong day yesterday and gave back a little today.
Many low-priced stocks were outstanding today. IPIX exploded up 3 to 7 on 25 million shares, or three times its float. Other low-priced stocks of note, VISG on a contract award was up 1.68. SIMG was up 1.50, ONCY up 1.08, and IBIS shot ahead 88 cents. ESMC was up nearly 1, and SNTO up 94 cents, as well as the SMH, the semiconductor tracking stock, up 1.28 and the QQQs up just under1.
So it was a very strong day on Wall Street today. Stepping back and reviewing the overall patterns, the key to today was that we tore through overhead resistance at 1455-60 zone on the Nasdaq 100 right at the opening and then tested secondary resistance up near the 1490 zone and closed just underneath that.
The market is very short term extended and oscillators are overbought, and I would not be surprised to see and it certainly would be healthy for the market to get some kind of pullback/retracement early next week. The S&P 500 did the same, blowing through the 1135 resistance area and moving up to secondary resistance in the 1143-45 zone, closing at around 1141 and change.
In short, a very strong week. The S&P 500 has gone from 1086 to 1145 in a rather short period of time, with the Nasdaq 100 in the same period of time moving from around 1370 to about 1490, or about 120 points inside of about 8 trading sessions. So we are extended and I expect a pullback next week, but the jobless news is very bullish for investor psychology and at this point the market can still achieve additional gains. But I would like to see the technicals improve, particularly on the New York Stock Exchange.
Good trading!
Harry |
