Tradable Tech Funds Follow Apple
Apple’s warning of a sales slowdown
weighed heavily Friday on the component stocks of the tradable tech funds. Some
money moved into drugs and chemicals, lifting the Pharmaceutical HOLDR and Basic
Industries SPDR. The telecom-focused tradable funds eeked out gains as well.
The Internet Architecture HOLDR
(
IAH |
Quote |
Chart |
News |
PowerRating)
declined 5.6%, but given recent volatility, the move reveals little to my eye.
It was the day’s biggest
loss among the exchange-traded
funds.
A sharp gap-down move on heavy volume,
be it in a stock or in an exchange-traded fund, tends to see further moves to
the downside. The Semiconductor HOLDR
(
SMH |
Quote |
Chart |
News |
PowerRating) has continued to follow-through
on the gap-down, high-volume decline on Sept. 22 (see Point
A in following charting). The basket of chip and chip-gear makers
fell 4.9%.
For technical analysis of the recent
downside gaps in Intel
(
INTC |
Quote |
Chart |
News |
PowerRating), Eastman Kodak
(
EK |
Quote |
Chart |
News |
PowerRating) and now Apple Computer
(
AAPL |
Quote |
Chart |
News |
PowerRating), check out my Trading
The News.
Among the Semi HOLDR’s components,
selling was particularly heavy in the chip-equipment stocks, such as Applied
Materials
(
AMAT |
Quote |
Chart |
News |
PowerRating) and Teradyne
(
TER |
Quote |
Chart |
News |
PowerRating). Broadcom
(
BRCM |
Quote |
Chart |
News |
PowerRating), a maker of
chips that enable digital transmission of voice, video and data over networks,
seems to be holding up relative to the semis.Â
On the plus side, the Basic Industries
SPDR
(
XLB |
Quote |
Chart |
News |
PowerRating) rose 2.5%, the Utilities SPDR
(
XLU |
Quote |
Chart |
News |
PowerRating) 1.4%, the Dow Jones
Telecommunications iShares
(
IYZ |
Quote |
Chart |
News |
PowerRating) 1.4%, the Telecom HOLDR
(
TTH |
Quote |
Chart |
News |
PowerRating) 1.3% and
the Pharmaceutical HOLDR
(
PPH |
Quote |
Chart |
News |
PowerRating) 1.0%.
If you’re new exchange-traded funds,
be sure to visit TradingMarkets’ Knowledge Center,
dedicated to explaining the basics of trading and active investing in ETFs and
mutual funds. Just click on the Funds tab
near the top of this page, then click on the Knowledge
Center tab.Â
You also will find lessons on trading
exchange-traded funds in the Stocks Education area of TradingMarkets.com. In
particular, check out my three-part series on trading ETFs, starting with
Average Crossovers. I also recommend newcomers read my tutorial,
HOLDRs: Unique Opportunity And Risk.
I am pleased to announce that I will be conducting an Intermediate-term Traders Clinic at TradingMarkets2000. I will be available for several hours Saturday, Oct. 14. and Sunday, Oct. 15 during the conference, to answer your questions about strategies and techniques for intermediate-term trading. Got a setup you’d like to discuss? Bring it with you! Please see our TradingMarkets2000 site for more information.