Spectacular Session for the Stock Market Bulls

Stock-Markets / Stock Index Trading Mar 24, 2009 - 12:35 AM GMT

It was a fantastic and huge session to start the week, as the indices gapped up big, ran hard in the morning, consolidated mid-day, tried to rollover but held support, and then exploded again in the afternoon as the shorts were squeezed right into the close in a spectacular session.

Net on the day the Dow was up just under 500, or 497.48, at 7775.86, the S&P 500 up a whopping 54.37 to 822.91, and the Nasdaq 100 soared 72.63 to 1215.81. The Philadelphia Semiconductor Index (SOXX) was up nearly 8 percent, up 15.74, to 234.45.

Advance-declines were better than 10 to 1 on New York, with 2864 up and 262 down, and more than 5 to 1 positive on Nasdaq, with 2332 to 450. Up/down volume was the story, though, with 1.863 billion to the upside and just 44.7 million million the downside on New York, nearly 42 to 1. Nasdaq had nearly 2.1 billion in advancing volume and only 131 million declining, a 16 to 1 positive ratio.

TheTechTrader.com board was nearly all positive, with many stocks up multiple points. The only stocks down were the ultrashorts, which got clobbered today. The UltraShort Real Estate ProShares (SRS) fell 21.14 to 49.80, the Direxion Financial Bear 3x Shares (FAZ) at 19.20 was down 15.80, and the Direxion Large Cap Bear 3X Shares (BGZ) down 15.43 to 58.40.

On the plus side, large-cap stocks had big gains, with Apple (AAPL) was up 6.07 to 107.66, and Amazon (AMZN) up 5.62 to 75.58.

Financials led the way, with JP Morgan (JPM) up 5.71 to 28.86, Morgan Stanley (MS) up 4.19 to 24.43, Goldman Sachs (GS) up 14.61 to 111.93 closing at the high for the day going away. Bank of America (BAC) was up 1.61 to 7.80, Wells Fargo (WFC) 3.34 to 17.33, and Hartford Financial Services (HIG) up 1.68 to 9.30.

The outstanding stock of the day was Central European Media (CETV) up 4.50 or 45% to 14.50 on more than 2 million on news of financing by Time Warner. Best Buy (BBY), recent Chart of the Day, jumped 1.80 to 34.10. Akamai (AKAM), a portfolio position, was up 1.66 to 19.79. Aluminum Corp. of China (ACH) broke out to a new multi-month high, up 2.94 to 17.05.

Agriculture stocks were strong, with up Agrium (AGU) up 2.36 to 38.62, Potash (POT) was up 5.99 to 82.66, and Mosaic (MOS) up 3.15 to 44.77.

SunPower (SPWR) at 24.80 was up 2.33, portfolio position Net 1 Ueps Technologies at 14.84 was up 1.06, (UEPS) General Electric (GE) up 89 cents to 10.43, portfolio position DG FastChannel (DGIT) at 18.37 was up 1.34 to a new multi-month high.

Cree Inc. (CREE) jumped 1.41 to 24.39, and the U.S. Oil Fund ETF (USO) up 1.02 to 31.78 on firm oil.

The iShares FTSE/Xinhua China 25 Index (FXI) popped 2.67 to 29.09, and the Direxion Financial Bull 3x Shares (FAS) was up 2.07 to 7.08 on 292 million shares.

iShares MSCI Brazil Index ETF (EWZ) at 40.89 was up 2.84, and the Ultra Oil & Gas ProShares (DIG) at 25.25 was up 3.46.

Stepping back and reviewing the hourly chart patterns, a 5-wave advance appears to have culminated in a strong spike-up advance, particularly at the close, as shorts seemed to have been squeezed into the close.

I wouldn't be surprised to see the market settle down and pullback tomorrow. But right now momentum is strong and the trend is your friend. The Nasdaq 100 closing just under 1260 is just 25 points from its key Jan-Feb double-top up around the 1285-90 zone. We'll see what happens tomorrow. The S&P 500 broke out above the 800-805 zone, closing at 823. The next resistance is the 838-40 zone, which may be more difficult to get through.

Good trading!

Harry

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