Wednesday, August 02, 2006

NASDAQ Technical Picture

Today's strength is being attributed to ADBE's affirmation of its Q3 EPS and revenue guidance. The market gapped up and held its opening gap throughout the session. A mid-afternoon swoon kept us from taking out the 20 EMA, however, we did manage 17 points on slightly higher volume. Software led the rally and most major tech sectors did well, the laggards were disk drive and networking which were down just slightly.

6 comments:

monkeydust said...

The two stocks that we discussed earlier in the year, Cigna (CI) and Electronic Arts (ERTS) did quite well today. I was asking back then about buying stocks that were in industries that were out of favor. Well, seems like those two have been picking up a bit lately.

NVDA has been looking great too. Don't know why they have been so strong lately. Not sure if they can hold this momentum into earning release on the 10th.

NGAS is still looking quite strong (better than others in the same sector). Guess I got lucky on that one.

Jamie said...

NGAS managed to close above its 200 MA and there's a lot of volume coming back into the stock. ERTS has formed a bullish saucer bottom and will no doubt fill its gap over the coming weeks. CI is still too hard to read - too many gaps. NVDA is one of my favorites. It has a lot of institutional buying and that's why it trades in an orderly fashion. I'm hoping for a good earnings report because I want to keep this one on my short list of intraday plays. I trade it at least two or three times a week and its a pleasure to trade because it doesn't chop around all over the place.

monkeydust said...

Let's just hope NVDA doesn't do a repeat of what happened two years ago next week. That's actually when I first started trading NVDA; a day after the big drop. But, things are different now. They had a lousy product back then compared to their competitor's far superior product.

Jamie said...

Are you planning to hold into earnings? You don't have to answer that, just curious. I see a lot of resistance at $25.00.

monkeydust said...

Yeah, I plan on holding into earnings. I just hope they don't "meet" or "slightly beat" expecations or they will get pummelled.

They say that like 65% of companies have been meeting or exceeding their earnings expectations. They fail to mention that a good portion of these companies still get hammered or go nowhere unless they blow their expectations away.

Since I'm just managing my 401k account (which I don't have access to for about 30 years) and am pretty diversified, I'm more risk tolerant than when I'm holding in my daytrading account (where I often put all my eggs in one basket).

But, really, the risk/reward for holding into earnings these days just doesn't favor longs.

Jamie said...

Well good luck. I hope to be able to play the AH if there's a big beat. I don't see much chance of a big miss. But as you say, if they meet or just slightly beat, it won't be good for the stock price.