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Biotechs Keeps Nasdaq In The Green!

|Includes:AIG, AMAG, AMGN, APOL, Celgene Corporation (CELG), COCO, EDU, ESI, FMCC, FNMA, INCY, OSIP

Last night, in my weekly Market Forecast, I mentioned that we'll need to see some more "venting" in some of the commodity sectors.  Indeed today, we saw weakness in these sectors.  I also thought that coals and steels may not be done going up, although they also needed to let off more steam.  After the morning weakness, both coals and steels climbed higher; many stocks even finished in the green.

Most sectors were weak today, but, we saw some money rotate into the biotechs.  CELG led the way with a +5% rise.  Other gainers include:  AMGN +2.48%, INCY +9.33%, OSIP +2.92%, AMAG +3.28%.  Besides the biotechs, the "troubled" insurers were on the run again.  AIG jumped more than +21% on news that the government may restructure the company's rescue package.  First thing this morning, we glued our eyes to AIG!  Last Friday, in the Trading Room, I commented,

September 18, 2009 12:09 PM
AIG
been stuck around $40 since breaking above $55; big move coming soon...

Happy Traders such as "mylady" woke up to a bagger (over +100% gainer):
mylady September 21, 2009 7:30 AM
Wow what a morning start - Bought AIG on Friday and
Closed AIG today for a gain of 139%

We added new AIG trades later in the afternoon and already locked in good profits today:
September 21, 2009
12:05 | HappyTrading AIG ($48.00) Sold to Close IKGJN Oct 40 calls, at $11.00 +29%
11:43 | HappyTrading AIG ($46.82) Sold to Close IKGJN Oct 40 calls, at $10.00 +18%
11:27 | HappyTrading AIG ($46.30) Sold to Close IKGJN Oct 40 calls, at $9.60 +13%
10:28 | HappyTrading AIG ($44.50) Bought to Open IKGJN Oct 40 calls, at $8.50

These Oct AIG 40 calls went as high as $12.86 and closed at $11.6.  AIG came back down just before the market close.  But, in after-hours, AIG traded close to $50/share again.  If AIG breaks the resistance at $50, it could easily test $55, which it could not quite break through at the end of August.  But, this time, we could see $60 from this jump.

FRE and FNM also benefitted from AIG's news, up +9.09% and +6.33%, respectively. 

Education stocks got a huge boost today as analysts released bullish comments on growth in this group.  ESI hopped a whopping +12.35, or +11.96%!!  APOL jumped +8.29%.  COCO tacked on +6.97%.  EDU rose +3.9%.

The Dow finished down 41.34 points; SPX slid 3.64 points; Nasdaq added +5.18 points:

Commodity sectors were weak:  XME (metals and mining) -0.9%, GDX (gold miners) -1.68%, OIH (oil services) -1.17%.  Both USO (oil) and UNG (natural gas) were down more than 3%.  XLF (financials) slipped 0.92%.  BTK (biotechs) added +0.83% while INX2 (internet) gained +0.88%.  FXI (Chinese ADRs) lost 1.34%.

SPX

SPX slid 3.64 points to close at 1064.66.  Its daily MAs were up, but, the MACD flattened.

Nasdaq

Nasdaq added +5.18 points to close at 2138.04.  Its daily MAs and MACD glided higher.

The market's early weakness today drew sidelined money in once again.  After the sharp rise in the past 2 weeks, the market saw some profit-taking.  However, the market managed to came back almost to green, with Nasdaq actually adding to its recent gains!  VIX tested 25 today (discussed in my Market Forecast), but, barely closed above 24.  This morning's weakness dampened the market's momentum a bit.  But, if the commodity sectors rise again, the market can still push higher.  Oil sank below $70/barrel as dollar saw some strength.  Gold managed to close above $1000/ounce.  We'll keep our eyes on these commodity sectors.

Good night and HappyTrading! ™

Stocks: CELG, AMGN, INCY, OSIP, AMAG, AIG, FNMA, FMCC, ESI, APOL, COCO, EDU