The indices are trading rather quietly at the moment with breadth running slightly positive, but there were some unusually big swings in the futures market overnight. The Nasdaq 100 ETF QQQ has been particularly random but has settled down now as traders eye the exits for a long holiday break.
It is likely that the end of the quarter has caused some acceleration in the program trading that is impacting the FAANG names, which have been the primary drivers of the QQQ. After the sharp swings the last three days there is an effort to catch another one.
At this point most of the window-dressing moves have been made, but there still might be a surge in volume at the close. Under the surface there is a little better action in FAANG names, oil is up for the seventh straight day, banks have reversed after strength on the stress test news and biotechnology is soft. Chips have been an issue lately and the reaction to the Micron Technology Inc. (MU) earnings is not helpful. Momentum names in general have been soft, and there is little life there. We only have about 80 stocks hitting new 12-month highs, which tells you how limited momentum has been.
It is going to be a slow and random afternoon with most folks closing up shop early. Don't forget that we have a half-day of trading on Monday, with the exchanges closing at 1 p.m. ET.
I've made a few small flips and don't have much going on. One trade I'm looking at is shorting of biotechnology with Direxion Daily S&P Biotech Bear 3x Shares (LABD) . It has been consolidating off recent lows and looks like it could make a thrust higher in a weak market.