After Monday's big drop, the market bounced right back up today, as financial stocks rebounded. The market has been trading in a tight range for about 2 weeks now (SPX 1300 to SPX 1330). Fertilizers have been really weak. In just 3 trading sessions, CF fell from $140 to today's low of $124.88 before bouncing back to close in the green. MOS also fell sharply from $86 to just under $80 in 2 days. We took some profits on our POT puts today:
- March 08, 2011
- 07:37 | HappyTrading POT ($57.60) Sold to Close 03P60 Mar 60 put, at $3.00 +71%
We bought these March 60 puts just yesterday at $1.75. The high was $3.1 and they closed at $2.5.
After the market, FNSR tumbled 35%, as its guidance was well below the concensus. FNSR closed at $40.04 today and traded down to about $25 this evening. CIEN also fell more than 10% on a weak forecast; it traded down more today and fell further this evening on FNSR's earnings. Other related stocks were also lower: JDSU -14.26%, APKT -1.47%, EMKR -9.39%.
The Dow was up +124.35 points; SPX added +11.69 points; Nasdaq gained +20.14 points:
INX2 (internet) and SOXX (semiconductors) both bounced a bit. XLF (financials) led the market with a +2.19% gain. XLE (energy) and OIH (oil services) were down less than 1%. FXI (Chinese ADRs) was up +2.41%.
SPX added +11.69 points to close at 1321.82, above 1320. Its daily MAs and MACD flattened.
Nasdaq gained +20.14 points to close at 2765.77, just below its 30-day MA. The MACD was slightly down.
The market has been very volatile, with big swings from one day to the next. We've been locking in quick profits and keeping lots of cash. Oil has been pressuring the market, but, dip-buyers seem to be still lurking around the corner. SPX will need to move out of the above-mentioned range to find any real direction. While techs may see some weakness from the networking/communication stocks, financials seem to have found some renewed strength.
Chinese internet stocks are catching buyers' attention. As smartphones become more and more prevailent, the number of internet users in China is increasing through mobile phones. SINA took a quick dip after its earnings report last week, and, has already bounced above its pre-earnings level. It was up +7.15% today. SOHU added +3.48%; SNDA advanced +2.28%; YOKU climbed +2.67%. If you're looking for trades on the long side, you might want to keep your eyes on some of these Chinese internet stocks.