Exaggerations
The Nasdaq futures were almost limit down this morning and now they are
printing green. If that is not volatile, I do not know what is. There was an
apparent short-covering rally this morning, but I still do not buy it (no pun
intended). The greatest rallies were seen in those stocks that were heavily
short.Â
The SOX was unable to retake 600, suggesting continued weakness in the semis.
Presently, the futures have broken the bottom of their uptrending channel and
the semiconductors are trying to do the same. The Nasdaq futures are
consolidating with a low of 2640. Set your alerts for a move below this level,
perhaps near 2625.Â
Be careful of short-covering rallies, as they can be violent.
AMD
(
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PowerRating) hit our short entry yesterday. If you held
overnight you should be aware of the next support level, which is not all that
far away.Â
Foundry Networks
(
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PowerRating) may be an interesting name to
watch. It has broken below the level that it tested for the last four days. Now it
looks poised to test the trendline that has been guiding it lower. Watch for
support near 40.
Until later,