Friday, September 07, 2007

The herd heads South

Storm clouds broke this morning and the herd headed South in a hurry. When the NYAD opens at .09 and the VIX gaps up 10% in tandem, you better know it's gonna be bad. The VIX is now back above the 20 DMSA, and although it finished on a doji the RSI is strongly hinting at a further rise.
The Qs opened at S2 and then fell to S4 in the first 2 hours on heavy volume before attempting a midday rally back to S3 before falling back to finish near S4 on another volume surge. That's a BIG drop and the Qs closed on the highest volume in 15 days. The 20 DSMA at 47.50 looks like the next target with both the RSI and MACD heading down. In afterhours trading the Qs are up .13, sharing a modest afterhours lift in the DIA, SPY and IWM.
Nevertheless, the closing TICK was -540 and the NYAD never made it past .29, so I am suspicious of the aftershours lift as indicative of anything meaningful. It's still a long ways to Monday's open and the premarket Globex will tell the real tale.

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