Stock Market Bloodbath on Treasury Secretary's News

Stock-Markets / Stock Index Trading Feb 11, 2009 - 03:20 AM GMT

The markets ended in a bloodbath today with extremely negative numbers across the board. The indices did rally after a negative opening, and the NDX and S&P 500 retested yesterday's highs, but they stopped in their tracks and reversed.

In short order they broke through yesterday's lows and headed south quickly, in a very steep 5-wave decline which did terminate just before lunch hour in a nice bounce. But that morphed into bear flags and they went lower again in the afternoon but at a less steeper angle. Only in the last 15-minutes did they manage to bounce again and come off the lows, but fell back again in the last few minutes.

Net on the day the Dow was down 382 at 7888.88, the S&P 500 was down 42.73 to 827.16, and the Nasdaq 100 down 52.36 at 1229.29. The Philadelphia Semiconductor Index (SOXX) was down 10.48, at 217.33, nearly 5 percent. Even the OEX was down nearly 20 to close at 390.

So big losses across the board.

And what's worse, the technicals were VERY negative today. Advance-declines were more than 5 to 1 negative on New York and 22 to 5 negative on Nasdaq. Up/down volume was the story on both exchanges, with 50 million shares up and 1.7 billion down on New York, a 34 to 1 negative ratio. Nasdaq had nearly 2.3 billion to the downside and 168 million to the upside, about a nearly 14 to 1 negative volume ratio.

TheTechTrader.com board were all losers, except for the two ultrashort ETFs we follow closely and one common stock, CF Holdings (CF), up 16 cents. The Direxion Financial Bear 3x Shares (FAZ) soared 10.24 today to close at 49.68 on nearly 33 million. The Direxion Large Cap Bear 3X Shares (BGZ) was up more than 8 points at 67.06 on nearly 11 million.

On the downside, Apple (AAPL) fell 4.68 to 97.83. The Direxion Large Cap Bull 3X Shares (BGU) was down 4.46 to 27.57. The Direxion Financial Bull 3x Shares (FAS) fell 3 to 8.13 on 160 million shares, the heaviest volume day ever seen on that one.

Shippers got hammered, with DryShips (DRYS) down 72 cent to 5.78, but at one point late in the session traded as low as 5.14. GNK, which we recently exited in the mid-22's, closed at 18.69, down 2.27. Excel Maritime (EXM) dropped 1.26 to 7.48.

In the agriculture sector, Potash (POT) fell 1.23, Mosaic (MOS) 1.47, Agrium (AGU) 1.95, and CF, as mentioned earlier, was up 16 cents, as earnings are coming out shortly.

Financials got slam-dunked across the board. BAC dropped 1.33 to 5.66, C fell 60 cents to 3.35, Hartford Financial Services (HIG) down 1.98 to 13.05, JPM 2.66 to 24.62, and MS 2.82 to 20.79. WFC also dropped 2.71 to 16.35.

Other losses of note, Sequenom (SQNM) had another 99 cent loss to 16.67, and Net 1 Ueps Technologies (UEPS) dropped 94 cents to 13.98.

Geron (GERN) fell 55 cents to 7.37, DG FastChannel (DGIT) at 14.13 was down 77 cents, and Central European Media (CETV) got slammed back 75 cents to 8.50.

Stepping back and reviewing the hourly chart patterns, the indices fell hard, cracked price and moving average support, and closed near the lows for the day going away, an extremely negative day for the indices, one which may trigger a much deeper slide. We'll have to see how the indices react in the next day or two, but certainly Wall Street and the traders did not like what the Treasury secretary had to say today about the bailout plan.

Good trading!

Harry

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