AvidTrader's S&P Analysis for Monday
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AvidTrader's S&P Analysis for Monday, November 20, 2006 Despite recovering to end the day unchanged, Friday's opening drop may have been a "warning shot across the bow" at buyers.
Rod David, President
AvidTrader.com, Inc.
Link: www.avidtrader.com
Same old, same old.
Friday's session-long rally from its opening low only recovered the day's losses, which was a long way to go just to end even. The open's sellers didn't expend a lot of energy because the gap merely neutralized Thursday's "ineffectual optimism." Friday's optimism was no more effectual than Thursday's. And now there are two days of it.
Sellers got their money's worth.
Friday's internals diverged negatively, as less NYSE down volume than up volume produced more advancing issues than decliners. Since Friday's total volume rose above Thursday's pace, Monday's session is obligated to reward Friday's sellers for their relative productivity
- whether only to retest Friday's opening low, or for sellers to gain traction for something more dramatic.
Hey, turkey, DUCK!
There tends to be a seasonal bullishness around holidays as vacations begin and liquidity evaporates. Markets are closed this Thursday for Thanksgiving Day, and close early on Friday. Liquidity can cut either way (often both) but sponsorship doesn't. If sellers were going to make a move soon, then that's when they need to make it - soon - and give buyers reason to lighten positions ahead of the long weekend.
The open speaks volumes.
Friday's expiration probably caused the open's gap down not to persist well into the afternoon. The gap may still be in-play, and Monday's open is no less vulnerable than was Friday's to declining sharply. But a second consecutive opening drop at this stage of the pattern would be much less capable of recovering intraday. Otherwise, quickly recovering to new highs would get a benefit of the doubt for being able to extend sharply higher intraday.
Today's market charts and individual equity plays are available at the site.
Rod David, President
AvidTrader.com, Inc.
Link: www.avidtrader.com
Same old, same old.
Friday's session-long rally from its opening low only recovered the day's losses, which was a long way to go just to end even. The open's sellers didn't expend a lot of energy because the gap merely neutralized Thursday's "ineffectual optimism." Friday's optimism was no more effectual than Thursday's. And now there are two days of it.
Sellers got their money's worth.
Friday's internals diverged negatively, as less NYSE down volume than up volume produced more advancing issues than decliners. Since Friday's total volume rose above Thursday's pace, Monday's session is obligated to reward Friday's sellers for their relative productivity
- whether only to retest Friday's opening low, or for sellers to gain traction for something more dramatic.
Hey, turkey, DUCK!
There tends to be a seasonal bullishness around holidays as vacations begin and liquidity evaporates. Markets are closed this Thursday for Thanksgiving Day, and close early on Friday. Liquidity can cut either way (often both) but sponsorship doesn't. If sellers were going to make a move soon, then that's when they need to make it - soon - and give buyers reason to lighten positions ahead of the long weekend.
The open speaks volumes.
Friday's expiration probably caused the open's gap down not to persist well into the afternoon. The gap may still be in-play, and Monday's open is no less vulnerable than was Friday's to declining sharply. But a second consecutive opening drop at this stage of the pattern would be much less capable of recovering intraday. Otherwise, quickly recovering to new highs would get a benefit of the doubt for being able to extend sharply higher intraday.
Today's market charts and individual equity plays are available at the site.
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