Thursday, September 29, 2011

Tech once more lagging, momo-stocks beaten down

What started as a big gap up, ended in the red. Especially tech got beaten down once more, while big caps (Dow) 'outperformed' (= lost less). Indices weren't even down that much intraday, but most momentum stocks and former leaders of the market got their ass kicked. On the other hand, oil, silver and gold were all up.

The market looks really weak, Nasdaq is still up more than most other indices, but it's 'gaining' quickly. Small caps are near last week's lows, and one more down day might get them under that level. Today we rose in pre-market on bullish news, but that's inherent to bear markets. They rather gap up and finish lower, while bull markets tend to gap down and finish higher. Of course it doesn't always work out like that, that would be to easy ;-)

Below the daily charts for DIA and QQQ:

S&P formed exactly the same pattern as yesterday. I went in on the break of the trendline (S), but got stopped out in the bearflag that followed (I lowered my stop to aggressively).
We reversed at 114 and this level is gaining more and more importance. We bounced here 4 times in the last 5 weeks. Once the market closes below this level, watch out! The reversal got us back near the breakout-point from the triangle. So, a strong finish, bringing us back in the green (except for tech...)

The 5m-chart for SPY:

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