XEROX JUMPS -- HEALTHCARE BOUNCES -- S&P 500 CLOSES OVER 50-DAY AVERAGE
XEROX IS TOP S&P 500 GAINER... Xerox was the day's top percentage gainer in the S&P 500. Today's bounce appears to have come just in time. Chart 1 shows the stock bouncing sharply off its 200-day moving averge on the heaviest volume in weeks. That's a good combination. The weekly chart also shows relatively healthy pattern. The stock briefly hit a 52-week high during June before beginning its current correction. Except for the big-volume drop near the middle of June, the downside correction has occurred on lighter volume, which is a good sign. The rising relative strength line along the bottom of Chart 2 also shows outperformance since last October.
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OTHER S&P LEADERS... Three other S&P 500 percentage leaders for today are shown below. Freeport McMoran Copper & Gold bounced off its 50-day moving average. FCX is benefiting from a strong gold group and a $4.00 bounce in gold. Motorola is rising on expanding volume. Sprint PCS Group is bouncing off its 200-day moving average. The strongest S&P sector today was healthcare.
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GUIDANT HELPS LEAD HEALTHCARE BOUNCE... Guidant was one of the day's biggest percentage gainers in a bouncing healthcare group. Its daily chart shows the stock moving up to a five-week high on rising volume (having stayed over its 50-day average). The weekly chart shows GDT moving up to challenge its highs of the past year near 50. That's a big test. A close above that barrier would represent a bullish breakout.
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HEALTH MANAGEMENT LOOKING HEALTHIER... HMA was another healthcare leader today. The daily chart shows the stock hitting the highest level since last October. The monthly chart shows the stock moving up to challenge the highs of the past three years.
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S&P 500 BOUNCES... After trading lower during the morning, the S&P 500 (and the rest of the major stock indexes) ended the day on the upside. Volume picked up from yesterday and the day's breadth was positive. The S&P 500 managed to hold at its 50-day moving average. In addition, its hourly-bar chart shows the S&P finding some support around the 50% retracement point of its August rally. The hourly MACD lines also turned positive for the first in a week. We're not inclined to read too much into the late-August move. But the end result was mildly encouraging.
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