Tuesday, February 12, 2008

Nasdaq Gives Up All Its Early Gains

I was worried when I saw the market up so much, so early. You know how I dislike strong opens in the market. Too much time for sellers to knock things down and profit taking to set in.

That is precisely what happened today. The enthusiasm off of the Buffett news probably was never enough to sustain a huge rally. Goldman Sachs (GS) never participated today, and when AAPL, RIMM, and BIDU rolled over, the writing was on the wall.

The S&P 500 didn't give up all of its gains, but the Nasdaq did, and then some. After hours, Applied Materials (AMAT) reported a solid quarter, which could help the Nazz tomorrow.

Interestingly, options players never bought into today's rally. The ISEE was low all day, and finished at 82. The CBOE put/call was high all day, and closed at 1.14.

So options players look like they were in there buying puts all day, maybe in anticipation of more market weakness ahead. That said, I would be more worried if options players were getting bullish.


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