Stay Away From This Group!
I am back and in one
piece. I don’t even know what my house looks like today as I went
straight from hotel to work. The Marriott resort I satyed at had the sides
of its buildings ripped off. I watched the hurricane from my balcony of the
17th floor. Just an awesome thing to see. Hope everyone made out ok.
piece. I don’t even know what my house looks like today as I went
straight from hotel to work. The Marriott resort I satyed at had the sides
of its buildings ripped off. I watched the hurricane from my balcony of the
17th floor. Just an awesome thing to see. Hope everyone made out ok.
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Here is what I wrote late Friday:Â Â
This report is simple. It is about the
SEMICONDUCTORS. As you know, we called the top in the third week in January at
541. On September 9th, at 371, I told you I was no longer bearish. I was not
bullish…just no longer bearish. After rallying up to 407 and then backing
off, I’m afraid I have some bad news for you. I am just about back to being
bearish…and that is not a good thing for the bulls. Let’s take a look.
The SOX has now broken below its plunging 50 day
average. It now feels like it is headed back to the recent lows.
average. It now feels like it is headed back to the recent lows.
I could show you charts of just about every stock
in the group…but they are mostly on the gross side…but just to give you a
hint, look how TER bounced strongly off its lows only to start to
miserably fail.
in the group…but they are mostly on the gross side…but just to give you a
hint, look how TER bounced strongly off its lows only to start to
miserably fail.
Most stocks in the group are missing estimates by
a mile. Earnings will be coming out in droves in the next couple of weeks. At
the very least, I would continue to stay away from this group.
a mile. Earnings will be coming out in droves in the next couple of weeks. At
the very least, I would continue to stay away from this group.
As far as the rest of the market, not much has
changed since yesterday. The DOW continues to lag…OILS continue to
smoke…and the tape remains about as challenging as we have seen in a very
long time. Give me a bull market, I am happy. Give me a bear market, I am
happy. Give me mess…and it’s time to head for Hawaii.
changed since yesterday. The DOW continues to lag…OILS continue to
smoke…and the tape remains about as challenging as we have seen in a very
long time. Give me a bull market, I am happy. Give me a bear market, I am
happy. Give me mess…and it’s time to head for Hawaii.
After scanning the market this past weekend, I
DO NOT HAVE MUCH TO CHANGE. We may just continue to be in a period with
little upside and little downside. I know it is no fun but you take what you
can get. AÂ point I do want to get across today is that less than 50% of all
stocks are in good technical shape. If this doesn’t improve, it is a
definitive longer-term negative. It is also the reason the market cannot get
out of its own way.
DO NOT HAVE MUCH TO CHANGE. We may just continue to be in a period with
little upside and little downside. I know it is no fun but you take what you
can get. AÂ point I do want to get across today is that less than 50% of all
stocks are in good technical shape. If this doesn’t improve, it is a
definitive longer-term negative. It is also the reason the market cannot get
out of its own way.
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One other point…OIL STOCKS are now very
extended. I would not be a buyer here. They are in bull mode but in dire
need of a pullback. Just look at DO and you will see what I mean.
extended. I would not be a buyer here. They are in bull mode but in dire
need of a pullback. Just look at DO and you will see what I mean.
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We are now entering end-of-quarter window
dressing as well as earning’s season. I will be watching for the numbers but
more importantly, I will be watching for the reactions. Â
dressing as well as earning’s season. I will be watching for the numbers but
more importantly, I will be watching for the reactions. Â
Gary Kaltbaum