Complete Thursday Game Plan

Markets displayed hallmark bearish activity Wednesday, beginning the day on strength, and finishing the day near lows for the session. Bull markets tend to do just the opposite and shrug off early weakness. Volume picked up as well Tuesday, as the markets retreated. The S&P 500 retested its 50 day SMA today, for the second time in 5 days. Today it did not reverse as it did last Thursday. The Nasdaq lost more than 1%, and closed right at the round 3400 number, and could possibly test its 50 day SMA soon. Many sectors took part in today’s damage, and one we saw in particular was the semiconductors. The SMH which going into this week had a bullish 3 week tight trigger of 39.38, recorded a bearish outside day today. It does remain just above its 50 day SMA, for those looking at the glass as half full. It is now down more than 2.5% for the week thus far. XLNX was not as fortunate Wednesday losing its 50 day SMA, on big trade, falling back below its 39.53 flat base trigger it took out on 5/28. DIOD which looked wonderful yesterday, when its intraday took out a 24.98 flat base trigger, only to fall back below it by the close of trading. Today it looked just as bad, as it looked good early on Tuesday, falling more than 5%. Demanding a close above the breakout trigger would have kept you out of DIOD, and you would have been grateful today. Recent earnings winner OVTI performed well today, demonstrating solid relative strength within the group.