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Stocks trading session lows

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Earlier weakness in the bulk of technology sectors has seen weakness build as we approach the final 45-minutes of trading as the NASDAQ-100 Index (NDX.X) 1,021 -2.25% leads the major index declines with sector weakness having the CBOE Internet Index (INX.X) 83.35 -3.78% lead lower by Amazon.com (NASDAQ:AMZN) $21.31 -4.9% after recently trading at 52-week highs.

Weakness in Dow Industrial's (INDU) 8,456 -0.36% component Home Depot (NYSE:HD) $24.77 -13% not only impact the Dow, but the broader retailing group with the S&P Retail Index (RLX.X) 277 -3% and Retail HOLDRS (AMEX:RTH) $72.17 -3.1% trading near their session lows and back at similar levels of last week's retail sales data.

While some risk is taken out of technology stocks on today's somewhat negative trade, the retail impact has the broader S&P 500 Index (SPX.X) 893 falling 6 points, or 0.71% and now just beginning to slip back under its starting to round out 21-day SMA. Last week, technical here had the SPX breaking below its 21-day SMA, but at that time, the shorter-term moving average was trending higher. Technicals here are near-term negative and have the rounding flat 50-day SMA of 867 potentially in play.

Today's volume shows slightly below average volume than what we've seen in recent weeks with the NYSE just pressing the 1.1 billion mark, while NASDAQ volume is heavier at just over 1.4 billion shares.

With the bulk of sectors in the red, we'd expect negative breadth and that's what we're finding with the decliners outnumbering advancers by a 3 to 2 margin on both the NYSE and NASDAQ.

In the new highs versus new lows category, NYSE continue to trail the NASDAQ in this category and today's action has just 19 stocks hitting new highs on the NYSE versus 28 stocks trading new lows. Meanwhile, NASDAQ remains rather bullish in this category with 37 stocks hitting new 52-week highs versus 33 stocks trading new lows.

For those index traders that may have initiated a bearish trade in either the NDX or QQQ from last night's wrap, I hold that trade overnight as Treasuries found buyers through their session and in my opinion, its worth holding a bearish trade into tomorrow and keeps bearish targets identified in play.

Jeff Bailey

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