The market started out flat, but, continued to gain strength through out the day. Oil fell again, by more than $5 today. The financials reversed their morning weakness and led the market up straight to the close. XLF jumped +6.48% and closed above $20 (the support level that we’ve been looking at). MA, which traded as low as $237.42 (and, filled the gap at $240), closed at $264.25, a swing of almost $27!! One of our members, makemoney, made a brilliant trade and caught MA on the bottom:
Makemoney
Posted July 8, 2008 at 12:54 pm | Permalink (Edit)
Thanks Dragon. Got in MA Aug 280 calls at 4.60, Now 11.30, so it’s tough decision. Will sell half. No use letting profits run away.
Those options closed at $11.20 today.
MER jumped almost +8% to close at $32.77. PRU also rebounded well, adding nearly $4 to close at $63.27, up +6.68%.
Techs were also very strong, especially the biotechs. BTK added +3.83%. CELG continued to ramp higher, up another +3.8%. SVNT, also mentioned yesterday about a possible breakout, gained +4.01% today, as we cashed out our trade for a +46.6% gain. SVNT could have more room to go, but, the intraday charts look a bit toppy. DNA tested resistance at $78 again today. We started a new position in this. I think DNA could break out before its earnings report next Monday. It’ll need to break above $78 first. BIIB hopped +6.91% and GENZ advanced +5.62%.
The Dow closed up +152.25 points; SPX gained +21.39 points; Nasdaq jumped +51.12 points:
VIX tumbled 10.20% and closed just above 23. XLF (financials) garnered +6.48% while HGX (housing) added almost +6%. INX2 (Internet) rose +2.7%. USO (oil) slumped 4.38% and UNG (natural gas) went down 4.7%. FXI (Chinese ADRs) was higher by +1.92%.
SPX
SPX gained +21.39 points to close at 1273.7. It closed below the 1280 level. Its MACD went higher.
Nasdaq
Nasdaq jumped +51.12 points to close at 2294.44. It closed just below the 1300 mark and its 10-day MA. The MACD was up.
The market has been trying to bounce for a few days now. It finally succeeded in sticking a rally to the close. I think we’ll need to see SPX bounce above 1300-1320 and Nasdaq above 2350 to feel more comfortable. However, it is very encouraging to see XLF rise above $20 to close at $20.53. It is also nice to see oil prices coming down. After the market, AA reported better-than-expected earnings. Its shares went up +3.46% in AH trading. This could give the metals and mining sector a boost tomorrow. So, I’ll be hawking on coal and steel plays. The important thing for the market tomorrow is to continue this rally. There’s likely to be some profit-taking during the day. We’ll have to see if the market can close strong again.
