Harvest Moon
The Dow gained 27 points last week while the Nasdaq NDX gained 28 points. The
Volatility VIX index had the best Action last week while stock indices had negative Action.
Sector Action for the week was minus 475.
16 Sectors were up while 16 were down.
The Bulls stumbled on Thursday showing there are some air pockets in the tape. This is
expiration week and with the indices pushing new highs the bias will be Bullish. Look for a
rally into Wednesdays close but traders will not forget the big turnaround Thursday and
how quickly the music stopped.
Google GOOG remains a bellwether for Institutional money flow. Financial sectors are
fairly weak.
Rydex Alerts- Bearish Dow and Russell likely to flip Bullish Monday or Tuesday but I will
not be long for long.
Short term Trading indicator- Overbought.
INTERMEDIATE TERM TRENDS- Bullish.
INTERMEDIATE OSCILLATOR - Overbought Sell.
Market Risk is extremely high !!!
China CZH - Number one in overall rank once again. A pure momentum play.
Consumer CMR- Fell out of the top ten. Beware !
Oil Patch XNG, OSX, XOI - A quick rebound after hitting some profit taking early last
week as the price of oil itself nibbled at new highs. $100 oil is within earshot.
Broker Dealers XBD and Banks BKX-Remain in the lower ranks. Took profits on Bullish
etf UYG and flipped to Bearish etf SKF now showing a small profit. This will be a big fly in
the soup for the Bulls this week.
Semiconductors SOX- I cannot recall a time when the Nasdaq 100 NDX led the broad
based indices and Semiconductors were stuck in the bottom ranks. Google GOOG and
Apple AAPL are the culprits. The divergence is clear and must be resolved with either a
rally in the Semis or reality in GOOG and AAPL.
Housing HGX- A local paper noted one nearby Town is expecting a budget deficit as tax
revenues will be reduced by 4% in light of the average decline in home prices by that
amount. It is amazing how quickly they can spend tax windfalls and how short sighted they
can be when revenues decline. This is fodder for those thinking the train wreck has yet to
come.
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