In what was expected to be a rather volatile early morning session after the jobless rate and nonfarm payroll numbers were giving mixed message, the late morning "vote" looks to have bulls saying "see-ya" as stock are at their lows of the session.
Per my Index Trader Wrap, the POTENTIAL reverse head and shoulder patterns on the 60-minute charts of the indexes have all seen their right shoulders cave in and looks to negate the potential for that bullish pattern.
Once these "right shoulders" were broken, stocks looked to pick up some downside steam and had the tech-laden NASDAQ-100 Index (NDX.X) 823 -1.2% breaking to a 52-week low. "Big tech" has shares of Cisco Systems (NASDAQ:CSCO) $9.63 -1.83% breaking to another consecutive session 52-week low and the stock leads NASDAQ's most active list. Other NASDAQ most actives and NASDAQ- 100 components have shares of Sun Microsystems (NASDAQ:SUNW) $2.50 -2.3% breaking to a new 52-week low, while Intel (NASDAQ:INTC) $13.98 +1.06% bucks the trend and is the 3rd most actively traded NASDAQ stock.
The Utility Sector Index (UTY.X) 239 -3.72% is challenging its September relative low of 238 after TXU Corp. (NYSE:TXU) $26.85 - 18% slashed its Q3 outlook to $0.90-$0.95 and Q4 to $0.60-$0.65 which was well below consensus estimates of $1.55 and $0.98 respectively. For 2003, the utility said it see EPS of $3.45- $3.55, which was below consensus for $4.67.
Shares of recently bearish profiled Duke Energy (NYSE:DUK) $18.42 -4.9% trade lower in sympathy with TXU Corp (TXU) and now challenge the price level of a recent secondary offering. For Duke bears, they would like to see DUK break the $17.50 level, get those bulls that took the recent 54.5 million share offering to cave in and drive the stock lower.
Share of Dow component and tech bellwether IBM (NYSE:IBM) $58.01 -3.3% have broken to a 52-week low, but volume is rather light at 4.3 million shares. Tech traders should at least monitor the stock on a near-term basis and perhaps measure the "rate" of the move lower. A quick look at IBM's point and figure chart has the bearish vertical count at $42. According to Dorsey/Wright and Associates, IBM is classified as belonging to the "computer" group and that sector is "bear confirmed" at 18%. Currently, it would take a trade at $63 to have IBM back on a point and figure buy signal.