The missing ingredient in today's tech rally has been the SOX. This could change tomorrow but until it does, exercize caution and watch SMH 34.90 resistance (June high and 50% 2006). A close above sets up tech bulls for a move to NDX/QQQQ 200 dma. It must be noted though that today's action saw new monthly highs with bearish divergences for COMP, NDX and QQQQ. This is option expiration week and QQQQ has lots of call resistance at the 40 strike. It should hold techs back into Friday, but a push by hedge funds could force some naked call writers to cover en masse. Stay tuned to the SOX and SMH for confirmation. NDX tagged 23.6% projection August at 1626 before retreating slightly. 200 dma is right above at 1630.
This entry was posted
on Wednesday, September 13, 2006 at 3:20 PM.
