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The market was volatile today. It opened flat and sank lower; then, it rallied back up to squeeze out a small gain before the close. Financials managed another strong day: GS +6.47%; MA +5.77%; JPM +7.94%; PRU +5.49%; PNC +7.46%. Techs were still on the weak side as Nasdaq finished in the red. But, GOOG and BIDU both had a good day, gaining +9.56% and +7.73%, respectively. I caught a quick trade on BIDU as things started to heat up in the late afternoon:
I entered this trade at 2:34pm and exited at 3:11pm. These options traded as high as $10.72 and closed at $9.4. Things move so fast these days, you have to take quick profits. This trade was only open for about 1/2 hour for a +28.8% gain. It does seem like if you trade later in the day, you can catch some pretty good moves.
The Dow was up +36.08 points; SPX added +5.58 points; Nasdaq fell 7.29 points (was down more than 40 points intraday):
SOX (semiconductors) lost 2.19%. GDX (gold miners) added +4.3% while XME (metals and mining) gained +5.02%. USO (oil) fell 6.28%, but, OIH (oil services) managed to close in the green. XLF (financials) continued higher, up +5.83%. FXI (Chinese ADRs) slid 2.09%.
SPX
SPX added +5.58 points to close at 857.39. It managed to stay above 850 and the 10-day MA. The MACD curved up.
Nasdaq
Nasdaq lost 7.29 points to close at 1464.73. It closed right at the 10-day MA. The MACD went higher.
The market definitely put on a brilliant effort to stay afloat today. VIX closed at 60.9, testing that support at 60. SKF, the financial ultrashorts, went from over $300 on Friday to now $156.12, with a day low of $151.95! That’s a 50% decline in 2 days!! We might see some bounces in these ultrashorts tomorrow, which could mean some more profit-taking from the market. Certainly, the new economic rescue measures announced in the past couple of days have provided the market some “juice”. But, the market does feel a bit tired and may need to let off some steam. In the past couple of months, every time the market pauses in its rally, sellers piled in and drove things much lower. Last night, I said, “After 2 days of big gains, the market closed at critical pivot points: SPX 850 and Nasdaq 1500 could give the market some resistance.” SPX is now a little above 850; but, Nasdaq is still below 1500. We’ll stay mostly in cash and see how the market handles these pivot points.
Good night and HappyTrading! ™
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