f: I agree with you more or less regarding today's action. On the SOX issue, it would appear there is support in the 550 area. However, there is a gap in the index in the 525-6 range, so a dip down there is a possibility. Interestingly, TXN, which came down almost 10 points today, finishing at 96 and change, also has a gap in the 84-6 range. Both gaps date from the breakout at the end of Oct.
SOX has now fallen below its 50 day ema (around 601), but TXN has not; -- it is sitting about a point above 50 day avg. Tomorrow's action, then, is critical. You do not want SOX falling and remaining in that gap area, which would invite a pullback to the 485 level. TXN is a key component. If it holds its 50 day average, I suspect the SOX will stabilize. WE need the SOX to resume upward. We need the banks, too. BKX is a mess. But both S&P 500 and NDX held support. Bonds are at high levels and upward move of Phila utility index suggests rates will come down. RUT held support too. My guess is equities are headed higher tomorrow after an ayem shakeout. But I am very very cautious here. M2 |
