These Charts Look Good… If You Invert Them!

“There is one motto I follow when entering earning’s season…IT’S NOT THE
NEWS, IT’S HOW THE MARKET REACTS TO THE NEWS. I will be watching reactions.
If stocks continue to fall on perceived good news, that will continue to be
a big negative. So far, the action has been less than thrilling.”

I penned those words in my last report. Let’s see a few reactions.

As you can see, not exactly positive reactions. There have been many
more…and unfortunately, not many gaps to the upside.

INTC has been the talk of the day. As you know, we have been negative on the
SEMIS almost every day since the top January 16th. As you know, I believe
the SEMIS are a great forecaster of the market. As you know, 100 out of 100
times, the market has followed the SEMIS up or down. For the market’s sake,
let’s hope this time it is different.

INTC has broke to a new yearly low. Yes…new yearly low. Those who believe
INTC is just going to turn back up had better take a close look at this
chart. That is one giant breakdown. All that support is now massive
resistance. But INTC has friends.

 

Most other SEMIS look the same. Suffice it to say, if you would just turn
the charts over, they would be roaring buys. That tells me there is more to
go on the downside. I heard too many ANALysts already out telling you to buy
with both hands. I don’t predict…but if I did, INTC is headed for the
teens.

The major indices are still holding in there but keep these numbers in
mind…DOW 10,166 and S&P 500 1106. A break below this short-term support
and these important indices would start to join the NASDAQ’s party towards
the May lows. Shorter-term, conditions are ripe for a bounce as there is a
lot of negativity out there. I am going to have to see a lot more conviction
before I can trust anything.

Gary Kaltbaum

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