Don’t Fight The Tape
OK, so I don’t know how to pick
horses. But I do know what a good market looks like. All three major indices have broken out of
cup-and-handle formations. Volume has been heavy on the up days and light on the down
days. What more do you want now?Â
Specifically, technology came to the forefront today as the
Nasdaq broke above the important 2200-2230 level. As soon as
(
CSCO |
Quote |
Chart |
News |
PowerRating) and
(
SUNW |
Quote |
Chart |
News |
PowerRating) broke above important resistance,
the rest took flight. Please keep in mind, there is resistance all the way up for the
Nasdaq. It just looks like 2400-2600 is the next stop.
If you want to own tech, most names have to be bought from lower bases. Out of
these, the Semi Equipment group has the best technicals. I have been writing about them
ad nauseum in this column. They had a couple of headfakes in the past but so
far, so good.
Many pundits continue to say this is short covering and the markets will retest the
lows. I continue to believe differently. Do not fight the
tape! The market is speaking loud and clear and I have big ears.
One note…The leading
Homebuilding group is now acting very suspect. I would be keeping a close eye on
them at this point.
There were plenty of good movers today. I will post them in the morning.
Have fun.