Wang’s Happy Trading

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The market was weak all day today.  Last night, I wrote:

“…[VIX’s] hourly chart is bottoming.  We have to be a little more careful here, as people are locking in profits.  SPX 900 will be an important support level.  Remember, this is also the options expiration week.  So, we could start to see some expiration manuevers kicking in starting tomorrow.”

Oil prices continued to fall.  Crude traded just above $36/barrel today.  This is down from $140/barrel just a few months ago!!  Oil services were especially weak:  DO -12.69%; RIG -13%; SLB -7.31%; NOV -12.38%.  Dollar firmed up and gold fell back.  S&P lowered GE’s outlook to “negative”, which exerted more pressure on the market.  RIMM reported better-than-expected earnings; its shares were volatile after the market, but, ended pretty much unchanged in AH trading.  ORCL announced a solid quarterly profit and the guidance was good; its shares were +3% higher.  POT cut its full-year outlook for 2008; its shares dropped almost 5% after the market close.

The Dow was down 219.35 points; SPX lost 19.14 points; Nasdaq fell 26.94 points:

OIH (oil services) led the market down, losing 10.76%.  USO (oil) dropped 5.98%.  XME (metals and mining) lost 6.82% while GDX (gold miners) fell 7.08%.  XLE (energy) slipped 6.82%.  SOXX (semiconductors) gave back 5.52%.  FXI (Chinese ADRs) was off less than 1%.

SPX

SPX lost 19.14 points to close at 885.28.  It closed below the 900 level.  The MACD flattened.

Nasdaq

Nasdaq fell 26.94 points to close at 1552.37.  It closed at its 10-day MA.  The MACD was flat.

So, the market gave back some gains, but, it’s still up for the week.  Both SPX and Nasdaq closed at their respective 10-day MAs.  The 20-day MA is curving up now and its about to go above the 30-day MA.  SPX closed below the 900 level, which is not very encouraging.  With the market lower, VIX still lost 2.5 points to close just above 47.  Lower VIX is good for the market, but, we’ll need to see the market stay above its 10-day MA.  A strong day tomorrow could help establish a new bullish formation in the daily MAs.  We cashed out some good profits yesterday, so, let’s be patient and wait to see if the market can turn this corner.

Good night and HappyTrading! ™