Schaeffer's Trading Floor Blog

Final Figures

by 4/4/2005 4:36 PM
Stocks quoted in this article:

As we saw in the previous post, the major indices bounced from their session lows...

Index Index Value Point Change Percent Change
S&P 500 (SPX) 1176.1 3.2 points 0.27 percent
Dow Jones Industrial Average (DJIA) 10421.1 17 points 0.2 percent
Nasdaq Composite (COMP) 1991.1 6.3 points 0.32 percent
Russell 2000 (RUT) 613.8 2.2 points 0.36 percent
CBOE Market Volatility Index (VXO) 13.49 -0.48 points -3.4 percent

However, this bounce didn't result in much in the way of net gains for the day and I don't see the action as being too significant for either the bulls or the bears. The bulls will take solace in the fact that the indices were able to rally off their lows while the bears will note the indices only recouped a portion of Friday's losses.

Overall, we see it was a mixed session. Semis and networking rallied from their lows but still closed below breakeven. Earlier today I showed a support level on the semis as they were slipping below it. The rally allowed the group to close just above that level. Internets led the day and are at their highest level since March 9. Oil backed off its highs and finished the session lower. Gold stocks started off weak and couldn't recover.

Stepping back to assess the environment, I think we are in more or less in the same situation we have been in for the last 8 sessions. The SPX, DJIA, and RUT are sitting just above critical support but can't seem to make any headway. The COMP is in a slightly weaker position but has been holding its recent lows.

While this daily back-and-forth action can lull you into indifference, I still think this is important to watch as I am not sure the Street is prepared for a break of this support...


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Into the Close

by 4/4/2005 4:09 PM
Stocks quoted in this article:

The bulls made an afternoon push...

Chart Courtesy of Thomson/ILX

..but lost some of the momentum at the close.


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Stocks quoted in this article:

Mike says..."Interesting move on AIG. Mr. Pendergraft wrote "A Day of Reckoning is Coming Soon". One of his charts was a daily of the DJIA showing a possible double bottom. Going out a little further it looks to me that the DJIA is trying to form a right shoulder of a large head and shoulders from 2000. Any thoughts"

My response - The daily chart of the Amex Diamonds is one that I have discussed before...

Created with SuperCharts by Omega Research

The support zone is drawn off the January lows and is similar to what we have seen in the SPX chart. As I have said before, I don't get too wrapped in technical patterns so I don't have much to add on the longer-term head-and-shoulders.

My primary use of charts is trying to gauge momentum and levels to watch. Right now the DIA is trapped in a sideways range as it tries to bounce from an oversold condition. I would be cautious on a break below this level...


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Stocks quoted in this article:

Here are today's top and bottom performing Exchange Traded Funds (ETFs)...

Top Performing Sector Exchange Traded Funds:

  • Internet HOLDRS (HHH) = +1.92 percent
  • Telecom HOLDRS (TTH) = +1.46 percent
  • iShares DJ US Telecom (IYZ) = +1.14 percent
  • Financial Select Sector SPDR (XLF) = +1.11 percent
  • NASDAQ 100 Trust (QQQQ) = +0.86 percent
  • Health Care Select Sect SPDR (XLV) = +0.78 percent
  • Retail HOLDRS (RTH) = +0.75 percent
  • Consumer Staples Select SPDR (XLP) = +0.66 percent

Bottom Performing Sector Exchange Traded Funds:

  • iShares DJ US Basic Materials (IYM) = -0.67 percent
  • iShares GS Natural Resource (IGE) = -0.72 percent
  • iShares C&S Realty Majors (ICF) = -0.77 percent
  • Materials Select Sector SPDR (XLB) = -0.80 percent
  • iShares DJ US Real Estate (IYR) = -0.80 percent
  • Oil Service HOLDRS (OIH) = -0.91 percent
  • iShares DJ US Energy (IYE) = -0.97 percent
  • streetTRACKS Wilshire REIT Fund (RWR) = -1.36 percent

As you can see, there is a bounce in tech related issues as internet, telecom, and the QQQQ are among the leaders. Financials are also seeing a bit of a bounce. Reits, energy, and oil services are the lagging the action...

Note: If you are not familiar with ETFs, make sure you read the Education and FAQ sections in our ETF center.

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More AIG

by 4/4/2005 2:47 PM
Stocks quoted in this article:

I have received a number of emails on American International Group (AIG) following my post below...

Chart Courtesy of Thomson/ILX

About an hour ago, New York Attorney General Eliot Spitzer gave a statement noting AIG's continuing cooperation and said he believes a civil resolution will ultimately be achievable. As you see, the shares popped on the news.

In the daily chart I posted earlier, you can see that the October bottom from last year was near 55. The stock had tried to hold this level last week before breaking on Friday. Today's rally has brought the stock back to this area which should act as resistance. However, I see 58 as being the "big" level on the stock. That was the peak last week and a push above that would likely give the bulls something to hang their hats on and pull more money into the stock.

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