Stock Market Indices Edge Higher in Afternoon Snapback After Steep Losses

By: Harry_Boxer

The stock market indices started the day to the plus side but failed at resistance and rolled over hard in the morning. They reached the session lows on a spike down just before noon at about the 1873 area on the Nasdaq 100 and the 1195 area on the S&P 500. At that point they began a stair-step move back up, which accelerated over the course of the afternoon and closed with the indices back into the plus column, but just barely.

Net on the day, the Dow closed up 5.67 at 10,625.83, but that was 190 points off its low. The S&P 500 closed 22 points off the low, up 1.26 at 1136.95, and Nasdaq 100, 43 points off the low, up 8.35 to 1915.45. That was a pretty strong snapback.

However, the technicals were not able to get back into the plus column, as decliners led advancers by 3 to 2 on the New York Stock Exchange and by 14 to 13 on Nasdaq. Up/down volume was 4 to 3 negative on New York and 3 to 2 positive on Nasdaq. Total volume was 1.4 billion on New York and about 2 1/4 billion on Nasdaq.

Antigenics Inc. (AGEN) popped 16 cents, or 13%, on 3.3 million shares. It had a big pop on heavy volume in early April, then a pullback consolidation, filling the gap and retesting the moving averages, particularly the 50, before another pop up and a pullback to test the 10- and 21-day moving averages. With today's move, it appears it may be beginning a new move that could test and maybe take out the 172 area. Secondary resistance is around 2, but the ultimate target on this is up around the 3-3.10 zone over the next several weeks potentially.

American Superconductor Corporation (AMSC) had a significant session today, up 2.43, or 7.8%, on 2.6 million, the heaviest volume in about four weeks. A big move in the last year and a half took it from 8 to the mid-40s, before the pullback in Jan, Feb, March and April and spike down to 24 a week and a half ago. Since then it's snapped back with a vengeance, going up to the moving averages and declining topsline, and today it took lateral key price resistance at around 32. Perhaps a follow-through may be in order here that could take it up to my next resistance around 36, followed by something near the 40 level, my intermediate-term trading target.

The Direxion Daily Emrg Mkts Bear 3X Shares (EDZ) followed through today to Friday's move. It had moved from 41 to 61 in four days when the market imploded the week before last, pulled back down, and then last week when the market took off it backed off sharply, steadied for four days, and on Friday popped back out. Today's follow-through got up to 51.90 at one point, filling the gap and testing initial resistance. The back-off may be an opportunity to add positions. My ultimate trading target is at the 60-62 zone as it retests.

The iPath S& P 500 VIX Short-Term Futures ETN (VXX) is also looking good after running from 18 to 31. It then backed off into the 24 range, based for four days, popped on Friday, and then had a follow-through today, up 62 cents to 27.48. Let's see if it will get a follow-through that accelerates it past the 31 area to my target around 34-35.

TheTechTrader.com board, as a result, was mixed but mostly lower. However, leading the way on the plus side, Akamai Technologies Inc. (AKAM) was up 2.13 to 41.03 and Cree Inc. (CREE) up 3.14 to 75.24. As noted above, the EDZ gained 1.03 to 48.85, although that closed 3 points off its early morning high.

Other stocks of note: ARCA Biopharma, Inc. (ABIO) jumped 54 cents closing at 4.81, 70 cents off its high. Acme Packet, Inc. (APKT) advanced 50 cents to 25.69. Delcath Systems Inc. (DCTH) had a big day today, up 1.16 to 14.69, and Vivus (VVUS) gained 63 cents to 12.47, along with Zoltek Companies Inc. (ZOLT) up 30 cents to 10.44.

The VXX, as noted above, was another ultra-short ETF that gained today.

On the downside, Hauppauge Digital Inc. (HAUP) gave back a chunk of its gains from Thursday and Friday, closing at 2.82, down a whopping 1.11 on 7 million shares today. RINO International Corp (RINO) in a weak Chinese sector was down 1.80 to 13.64. Brigham Exploration (BEXP) gave back 56 cents to 16.40, Baidu Inc. (BIDU) 80 cents to 73.18, Houston American Energy Group (HUSA) 44 cents to 11.34, and Las Vegas Sands (LVS) 93 cents to 22.50.

Stepping back and reviewing the hourly chart patterns, the indices were mixed early on, then plunged to new retest the lows before a very solid snapback afternoon session brought the indices back in the plus column. But we'll see whether they can take out more formidable overhead resistance near 1920 on the NDX and 1142 on the SPX and extend the rally or whether that resistance becomes tough to get through and results in a market rollover.

Good trading!

Harry

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