Those are squirrels boxing but you get the idea.. today’s bout between bulls and bears went nearly 12 rounds, with the bulls delivering the knock out punch just before the final bell. There will no doubt be calls for a rematch. In what was one of the wildest days of trading action I can remember, the market at one point was on the absolute verge of collapsing below critical support levels before buyers rushed in to save the day in the last 40 minutes of trading in what was a ferocious level of buying. The fact that the Dow surged more than 250 points in the last 40 minutes of trading puts it in perspective. I think today’s action probably marks a bottom in the short term. What I mean by that is that it was probably the bottom marking the beginning of a what could be a significant bounce to new resistance areas. That being said, I’m going to remain cautious because the overall picture is one of deteriorating technicals with any short term rally providing opportunities to short and exit positions (as well as day/swing trading for you short term traders). I mention this below as well, but it should be noted here that leading stocks didn’t participate in any way today with the Self Investors Leading Stocks Index closing down a bit for the day. While today’s action was bullish, it was not the kind of move you see in healthy markets. This market is obviously still searching for some identity and some support. In these volatile times, it’s probably best for most people to sit it out on the sidelines.
I’ll have a full run down of the charts this weekend.
::: Major Indices Performance – The Numbers :::
(Note: volume averages are based on the average over the past 50 days)
Data as of 4:00EST – End of Day August 1st 2007
Accumuluation across all indices.
Nasdaq: UP .30% today with volume 33% ABOVE average
Nasdaq ETF (QQQQ) UP .78%, volume 129% ABOVE average
Dow: UP 1.14%, with volume 43% ABOVE the average
Dow ETF (DIA): UP .94%, volume 162% ABOVE the average
S&P ETF (SPY): UP .49%, volume 176% ABOVE the average
Russell Small Cap ETF (IWM): UP .54%, volume 99% ABOVE the average
::: SelflInvestors Leading Stocks :::
The Self Investors Leading Stocks Index is comprised of stocks in the Breakout Tracker, which is a database of the fastest growing companies near a breakout or having already broken out of a base. Leading stocks DID NOT participate in today’s rally and closed the day with a loss.
Summary:
* Decliners led Advancers 207 to 187
* Advancers were up an average of 1.95% today, with volume 53% ABOVE average
* Decliners were down an average of 2.40% with volume 82% ABOVE average
* The total SI Leading Stocks Index was DOWN .34% today with volume 68% ABOVE average
::: Where’s the Money Flowing :::
Many investing websites provide leading industries based on price performance alone. However, without accompanying volume levels, this can sometimes be misleading. The only way that I know of to gauge industry/sector strength WITH volume levels is through the analysis of ETF’s. A couple years ago this was not possible, but as more traders/investors use ETF’s they become a much better tool for gauging the health of the market and seeing where the money is flowing (or not flowing). Using the proprietary SelfInvestors Demand Indicator score which measures price and volume movements, I’m able to quickly see which sectors/industries are seeing the greatest inflows of cash. For a detailed look at how I go about gauging sector/industry strength please see the following post: http://selfinvestors.com/si/industry_tracking/
* Current Leading Sectors/Industries (over last 30 trading days):
Networking, Global Technology
* Current Lagging Sectors/Industries (over last 30 trading days):
Broker/Dealers, Utilities, Home Construction, Financial, Health Care, Banks
* Today’s Market Moving Industries/Sectors (UP):
Utilities, Telecom, Real Estate, Aerospace/Defense
* Today’s Market Moving Industries/Sectors (DOWN):
Oil & Gas Services, Home Construction, Gold, Oil
::: Stocks :::
The stocks section will be an area where I highlight one stock selected from a group of stocks moving up with volume well above average and most likely breaking out of a base or consolidation.
Sorry, no stock of the day today… there were few candidates.