The gap-down open this morning and the poor Empire State Manufacturing Survey caught bulls by surprise. The continuous negative news about Greece kept the pressure on all day.  Volume was higher than what we’ve seen recently as with last Friday’s big drop.  The S&P 500 is quickly approaching its 200-day moving average.  Many are looking at the 1250 area on the S&P, but we may need to keep an open mind on the situation as a lot will depend on Europe’s news flow.  I remember during the 2008 financial crisis, many were looking for a tag of the 200 day moving average for a bounce and we sliced right through and kept going down, something to keep in mind as we progress through option expiration.  

Maybe today’s drop below the 200 day moving average for QQQ had something to do with worries about 2nd quarter earnings.  For all the growth story surrounding smart phones and the related massive networks that need to enable the cloud and video downloads, Finisar, the ex fiber optics darling, had guided next quarter’s earnings per share in the range of $0.16 to 0.20, far short of the $0.37 estimates.  This is after an ugly March guide down earlier this year.  This is also vastly below what the analysts being forecasting in the last 60 days.  Are the analysts too complacent? If this trend continues in other technology names, it could be a long earnings season for the bulls.