It was a pretty nasty reversal after the FOMC meeting on Wednesday, and the market really plunged through several support layers, and in my mind, that actually ruined a really nice set of patterns for a bottoming extension. It still could occur, and very well could reverse on Thursday, because the indices often reverse 24-48 hours after the FOMC. In other words, whatever movement there is after an FOMC meeting often reverses. I would have to say that we are looking at more downside unless there is an immediate reversal. For now, there are some longs and shorts to cover here, so let’s go over them.
Cray Inc. (O:CRAY) has a really nice chart, and possibly a good swing trade if it gets to 42. This stock moved up in the face of a declining market on Wednesday, 1.19 to 38.46, or 3%, on 871,700, and closed near the high for the day. That is absolute, excellent action for this stock. Support is at 36, target is 42. It has 11.62 days to cover.
The Direxion Daily S&P Biotech Bear 3X ETF (N:LABD) is rockin’ it. After forming a base, breaking out and retesting the trendline, it looks like the spike up of 8.16 to 68.07, or 13.6%, on 595,300 shares traded could extend. If it goes down on Thursday, it could get the momentum necessary to get it up into the mid 70’s. The target is 74-74 1/2.
The ProShares Ultra VIX Short-Term Futures (N:UVXY) jumped 3.45 to 39.80, or 8.3%, on 33.4 million shares traded. It has exploded from the 26 range all the way up to 59, and the pullback last week from the market rally has taken it back down near 40. It reversed sharply on Wednesday from 39.80 to 46.22. 33.4 million shares is the best volume in four sessions. If it gets through 46 on Thursday, which it could at the opening, the target is in the 50’s, maybe 58-59.
Other stocks on the long side included Barrick Gold Corporation (N:ABX), Hawaiian Holdings Inc. (O:HA), Direxion Daily Jr Gld Mnrs Bull 3X ETF (N:JNUG), Direxion Daily Gold Miners Bull 3X ETF (N:NUGT), Direxion Daily S&P Biotech Bull 3X ETF (N:LABU), Terex Corporation (N:TEX), VelocityShares Daily 2x VIX ST ETN (O:TVIX), and Direxion Daily Small Cap Bear 3X ETF (N:TZA).
Stocks on the short side included ACADIA Pharmaceuticals Inc. (O:ACAD), AmSurg Corp. (O:AMSG), Capella Education Co. (O:CPLA), Criteo SA (O:CRTO), Global Payments Inc. (N:GPN), Inogen, Inc. (O:INGN), Papa John's International Inc. (O:PZZA), and Red Robin Gourmet Burgers Inc. (O:RRGB).