Semis Moving Up In Rank
Spent the last
two days home with the ‘flu. It afforded me time to just watch the
action. Didn’t have any calls, didn’t do any trades. Kind of wish I did. But...over the past several months, every time the market has tried
to rally, I would go through the same exercise. I would first call one of my
closest trader friends out in California who has one of the sharpest eyes for
the market. Needless to say, he kept me from jumping the gun many times in the
past year. He works off of the same principles I do.
The next step is to take a look at every stock on the New
High List. Yes, every stock. Not much for my time: 76 muni trusts, 29
regional banks, 22 energy, 14 builders,13 S&Ls…
The bottom
line: While I am starting to see some decent breakouts, while the Nasdaq
has been acting almost perfectly on price and volume since Jan. 3, while A/D
lines are rising, while there has been money to make from the January
effect in the beaten-downs, while the reporters on CNBC are showing their
smiling teeth again, there still remains a lack of
leadership.
Certainly, techs — especially semis —
are moving up in rank. There is just a lot more work to be done. But I do know
the repairing process has to start somewhere and that process would be different
than others because of the depth of the drop. Hey, I am learning during this one
also. The determining factor to tell me this will get legs is a bunch of
breakouts off of tight consolidations. Stay focused on this.
As of this writing Wednesday night,
(
IBM |
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Chart |
News |
PowerRating) is up over $6. Thursday’s market
will probably open nicely. But look at yesterday. Many stocks reversed to their
lows of the day on huge volume. Serious late-day
distribution. This probably indicates the Nasdaq is getting close to its
first important area of resistance. My guess is some backing-and-filling are in order here.
Since you have been asking for some breakouts, take a look at
(
CDN |
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News |
PowerRating),
(
UTEK |
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News |
PowerRating),
(
SBSE |
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Chart |
News |
PowerRating), just to name a few. I do suggest close stops. Over the past
eleven months, most have failed.
To be fair to the other side, and as we have mentioned previously, Healtcare
has topped out. The Biotech Trust (BBH) shows a clear topping out. I would be
watching carefully. Not only does it look about as suspect as they come but
individual names look horrible.
