Aside from the selling in the energy sector, it was technology
that has sellers working at an aggressive pace on Wednesday. Down
three days in a row and nearing oversold territory are shares of
Direxion Technology Bull 3X Shares
) , which pulled back by more than 5% on Wednesday alone.
Weakness in semiconductor stocks helped anticipate much of the
broader selling now spreading throughout the technology sector (see
"A Closer Look at the Selling in
from earlier in the week). Closing lower by more than 2% ahead of
trading on Thursday, shares of
Cisco Systems Inc
) , for example, have now finished lower for three days in a row
and are oversold above the
200-day moving average
. Also lower for third consecutive session and oversold after
dropping by more than 1% were shares of
) . INTC is also trading in bull market territory.
) has been unable to buck the selling trend in recent days. The
stock has finished down for three sessions in a row, and is
oversold for the first time since the pre-Thanksgiving holiday
lows. Shares of Apple pulled back by more than 2% on Wednesday.
Heading into Thursday's session, Cisco and Intel have earned
ratings upgrades to 7 out of 10. At the upper end of our "neutral"
category, both stocks will need to sell-off even further before
they will have returned to levels where buyers have become
interested in the stocks in the past. During the pullback in Intel
in the first half of November, for example, shares fell for six
consecutive sessions before becoming
enough to lure buyers back into the market. From the final days of
September to the first few days of October, AAPL closed lower for
seven in a row before a short-term low was made. Shares of Apple
have neutral, 6 out of 10 ratings as of Wednesday's close.
Traders can accommodate this volatility by looking to enter
positions with wider than usual intraday entries, for example,
looking for markets to
by more than 3% on an intraday basis before buying. Another
approach is simply to be more discriminating, choosing both fewer
and higher rated stocks for short-term trade, until edges are
larger and more abundant.
All of the stocks in today's report were available from
research and data available through PowerRatings. To learn more,
is Editor in Chief of TradingMarkets.com