NASDAQ Technical Picture - Loss of 200 DMA

The first chart is the NASDAQ daily which has lots of technical info. Click on the chart to enlarge the view.

Basically, we gapped lower on the open and tried to recover the 200 MA in the early part of the session. This was followed by a swoon back down and a second lower high in early afternoon, after which the bears took over in earnest. We closed at the session lows in line with a significant PP which was in play on and off from Nov. 06 - Mar 07.

We have retraced more than 62% of the March - July rally and will, no doubt, retrace 100%. However, the lower low creates a new trendline (black line) and we are getting quite extended from that trendline and the lower MAs. So technically we should get some relief either through consolidation, or a bounce towards the trendline.

Below are two watch list stocks, and the point I want to make here is that most of my watch list stocks look like MDR, basing at or near a significant PP and could break down anytime. The last chart is AMLN which I highlighted last night. A nice B&B trade if you took it in the morning before it too, succumbed to weakness in the afternoon.



Companies moving in after hours trading in reaction to earnings: Trading Up: NTAP +5.4%; CAI +1.7%; IMOS +1.3%; PETM +1.1%... Trading Down: CGNX -7.7%; LMRA -1.6%... Companies moving in reaction to news: Trading Up: BZH +4.5% (files form 8-K containing financial statements); KOSN +3.7% (files $75 mln mixed shelf offering - S-3); PNFP +3.1% (announces the in-market acquisition of Mid-America Bancshares; co sees as accretive to earnings in the first 12 months); AMFI +2.8% (names Donald Wilson President and COO); USTR +2.6% (increases stock repurchase authorization; authorizes an additional $200 mln); HOC +2.6% (reports Navajo refinery unit back online); UIC +2.1% (wins $8.6 mln order from Royal Australian Navy); XXIA +1.9% (announces authorization to repurchase up to $50 mln of common stock); SPWR +1.9% (signs agreement with SMA Technologie AG); VLTR +1.6% (announces appointment of Mike Burns as Vice President and CFO, to succeed founder Greg Hildebrand)... Trading Down: UTSI -1.8% (receives Nasdaq notification related to late filing of its Form 10-Q for Q2); IIG -1.1% (notes in an 8-K the Superior Court of California entered an order, without explanation, denying the request for stay of the Court's order); AMGN -1.0% (restructures due to lower Aranesp revs; cuts FY07 EPS to $4.13-4.23).