May Day
The Dow gained 158 points reaching a new high while the Nasdaq NDX rallied 45 points.
Only the Nasdaq NDX had positive action for the week. All others were negative meaning
the wheels are slipping on this rally. Overall Sector Action for the week was minus 525.
23 Sectors were up while 11 were down.
The Dow Jones closed above 13,000 last week - hurrah. Techonology sectors made a
good jump into the top ranks. Financial sectors are still in the bottom ranks. I am not sure
we have ever had a new high in the Dow Jones while the Broker Dealer index is in the
bottom ranks. What are they thinking about their own stocks?!
Rydex Alerts- Took quick profits on a Bullish NDX/OTC position leaving me Short Russell
and part cash. Looking to be completely short Russell Monday.
Short term - Overbought Sell with negative breadth. Momentum or Tradewind is the only
indicator still rising however it is near the ceiling.
INTERMEDIATE TERM TRENDS- Bullish
INTERMEDIATE OSCILLATOR- Overbought and rolling over. Recommending Puts for Portfolio Insurance.
Networking NWX - Number one with a big jump in relative rank last week. Cisco CSCO
earnings will tell the tale but they are not due until May 8th. The sector is overbought.
Negative or less than positive earnings will be a big price dissappointment.
Oil Service OSX- Into the top ranks and back in a steep uptrend. DIG and RIG have been
the ETF or stock leaders here.
Pharmaceutical DRG- Fell out of the top ranks. Take profits in these stocks.
Utilites UTY- Falling in relative rank after the FOMC minutes hinted there will be no
lowering of interest rates soon. I would be inclined to take profits in these stocks.
Semiconductor SOX- Nice rally into the top ranks. Took profit in the Semiconductor
Bullish Ultra ETF USD. The Ultra’s are working quite well and just as hoped giving you
instant sector participation with enough leverage to overcome not being in the leading
stock.
Transportaion IYT- Fell as the Oil Patch rallied. Will likely take profit in JBHunt JBHT
this week. I would do the same with any airlines.
Financials XBD, Banks BKX, Capital markets KCE- Still in the bottom of the heap.
Price is up relative rank is a sticking point.
Housing HGX - Still in the bottom ranks. My sense is the housing slump is just beginning
with a lot of bubble to squeeze out as yet.
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