DOW HITS NEW 52 WEEK HIGH -- TECHS AND SMALL CAPS LEAD MARKET RALLY -- SOX BREAKS OUT
QQQS ARE MOST ACTIVELY TRADED UNIT... At midday, we showed the Dow Industrials hitting a new 52-week high. The biggest percentage gain, however, was seen in the Nasdaq 100 Index. The QQQs were also the the most-actively traded issue in today's strong market advance. The daily chart showed the QQQs jumping through their 50-day average on rising volume. The daily stochastic lines are rising from oversold territory; and the daily MACD lines turned positive for the first time in a month. That means that the big techs led today's rally. Tech leaders included the Internet, Networkers, and the Semiconductor Index. The SOX Index closed at a new 52-week high. Small cap stocks restored their leadership role with the S&P 600 (Small Cap Index) also hitting a new yearly high. Other groups hitting new highs were cyclicals and retailers.
Chart 1
Chart 2
Chart 3
LOWES LEADS RETAIL RALLY... Lowes was the leader in a strong retail group. The daily chart shows the home improvement stock climbing to a new high on the strongest volume in three months. The weekly chart shows the retailer breaking through the 50 level, which was the previous peak hit during May 2002.
Chart 4
Chart 5
INTEL AND ALTERA HIT NEW HIGH... Intel was a big story today. The chip bellwether broke out to a new 52-week high on rising volume. Earlier today we showed AMD breaking out on volume. Another big chip winner was Altera which hit a new high on rising volume.
Chart 6
Chart 7
GE JUMPS ON BIG VOLUME... General Electric was another big Dow gainer. Although it didn't hit a new high, GE surged through its 50-day average on strong volume. The Dow bellwether had just survived a challenge of its 200-day moving average.
Chart 8
EURO FALLS TO 3-MONTH LOW -- BONDS BOUNCE... The Euro fell to a 3 1/2 month low against the dollar today. That means the dollar is moving upward. A rising dollar is positive for stocks, but caused some profit-taking in gold and gold stocks. The stock market may have also gotten some support from an oversold bond market. The final chart shows T-bond prices bouncing off a three-year support line. A stable bond market is another positive factor for stocks. All things considered, it was a good day all around.
Chart 9
Chart 10
