Are The Bulls Just Full Of…Well…Bull?
Amazingly,
the stock market bulls weren’t able to put a positive spin on the
fact a U.S. aircraft
collided with a Chinese F-8 fighter jet resulting in an emergency
landing of the U.S. plane. For the first time in recent memory, the
bulls didn’t have the creativity to create a “panic buying” scenario
out of
absolutely horrible news. All joking aside, however, our prayers are with
the 24 U.S. airmen
currently being held by the Chinese government as we await their
safe return to American soil.
What happened to the mighty
semiconductor index? What happened to all the strategists
claiming that the prior month’s strength in the SOX was going to give
the Nasdaq the much-needed strength to claim a bottom and move higher? What
happened to the
“bottom” we heard so very much about the past two weeks? In
my March 23 commentary, I
stated:
“You have to love the fact that
the semiconductor group is being heralded as the sector
‘most likely to pull the Nasdaq out of the bear market.’ What’s next, the
semiconductor group will pull the Nasdaq up to new index highs? Make a
note of this and watch
this group closely for signs of a top since it is my opinion
that the semiconductor group will be decimated some time not so far
off in the future. The
fundamentals surrounding the sector are dismal and do not
have hope of improving in the next two to three quarters.”
Fortunately for us, we didn’t believe
the stock market charlatans and shorted away.
The stocks I cited like
(
AMAT |
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PowerRating),
(
VTSS |
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PowerRating),
(
LLTC |
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PowerRating) and
(
MU |
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PowerRating) all
bit the proverbial
big one. This is just one more instance in the long list of con jobs
by the Wall Street bulls thus far this year. The semiconductor group
looks absolutely horrific
and should continue to trade lower, pulling the Nasdaq
with it. Frighteningly, the SOX looks to possibly have a date with
the 400 area. So much for
the possibility of a technology bounce at the beginning
of second-quarter trading. Please reference my March
10
commentary
and re-examine the long-term chart of the Nasdaq Composite I included.
As you can see, we are approaching an area on the Nasdaq Composite
that I called a “key
level” in the 1740-ish zone. Keep your eyes peeled to these
long-term retracement levels.
In the bigger picture, the Dow Jones
Industrials gave us a total reversal sell
signal today. Forget about the end-of-day markup, the Dow is headed
lower. We should look for
potential support in the 9400 area to produce a little
bounce.
In this area of the market, focus on
the financials here as the BIX put in a major
reversal today. Also, oil drillers and select retailers look to be
running out of steam on
their “safe haven 2001” tour. At some point, and it won’t
be long, the world will realize that the retailers aren’t going to save
the planet, and they will
be decimated. I’ll be there short when it happens.
In the “let’s run
up something stupid so the insiders can sell” department, let’s
take a look at Hot Topic Inc.
(
HOTT |
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PowerRating). This company caters to the
“gothic”
subculture and is soon to open a store called “Torrid” for the
plus-sized gothic teenage
female. Hmmmm…the areas for growth are endless, don’t
you think? I want every one of you to go their corporate website at
www.hottopic.com and let
me know what you think. Honestly, I may have never seen
anything as ridiculous as this in my entire life.
In other words, ready the photon
torpedoes, Mr. Sulu.