Stocks surged Tuesday after the Northern Alliance captured the Afghan capital of Kabul.
The ISDEX http://www.wsrn.com/apps/ISDEX/ rose 6 to 171, and the Nasdaq soared 51 to 1892. The S&P 500 rose 20 to 1139, and the Dow surged 196 to 9750. Volume rose to 1.35 billion shares on the NYSE, and 2.18 billion on the Nasdaq. Advancers led 22 to 9 on the NYSE, and 23 to 12 on the Nasdaq.
After the close, Network Appliance and BEA Systems
topped estimates, but both traded lower. Sycamore
and PurchasePro
also beat estimates.
Hewlett-Packard and Applied Materials
will report after the close tomorrow, and Dell
will report on Thursday.
During the day, Oracle fell .88 to 14.52 after guiding estimates lower.
Cisco rose .32 to 19.58 despite saying it sees 2-8 months of slow growth.
Check Point surged 3.39 to 41.90 on a JP Morgan Buy rating and $50 price target.
IBM rose 1.84 to 116.70 ahead of an analyst meeting.
Some technical comments on the market: Note: We include charts in the technical market commentary. If you can’t get the charts via the e-mail newsletter version, try this link: http://www.afterhourstrading.com/column.html
The market is closing in on some very interesting levels, particularly on the Nasdaq. If this is just a wave 4 countertrend rally on the Nasdaq, it can’t go higher than the bottom of the first wave down from the May top, which is at 1934. If it goes higher than that, something else is going on, probably a higher-degree countertrend rally that could last for some time and go to at least 2300. The Nasdaq also would hit its .618 Fibonacci retracement level from the May top at 1968; above that level, the move would become a trend in its own right. Two very big levels to watch. For the S&P and the Dow, the bottom of wave 1 is 1164 and 10,120, and the .618 retracement levels are 1173 and 10,093. Sentiment is beginning to get a little frothy, which argues for some sort of pullback to begin soon. The Dow (first chart) closed at the upper trendline of a potential broadening top today; a move above 9770-9780 could give the index room to run – if it can do it with some force and volume behind it. First support is 9650 and then 9600. The Nasdaq (second chart) gapped above its May downtrend line today, and ADX, an indicator of trend strength, has begun to turn up, another positive. The Nasdaq continues to be the best-looking of the major indexes. First support is 1867-1871, 1855, and then 1840. Resistance, and it’s a biggie, is 1934. The S&P (third chart) also took out some strong resistance. Next up is 1145-1155, and then 1164-1173. Support is 1120-1126.
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