First of all, all these profit warnings... this was all known two months ago and has nothing to do with the sell off despite what the media tells us>>>>
the news is not the key, it's the reaction to the news, a # of tech stocks on the nyse & daq most actives were gapping down on downward earning revisions, nothing bullish about downward earnings revisions, while the daq did a false breakout last week, many many tech stocks have been coiling since the 4/19 top on declining volume and are now breaking out on expanding volume to the downside, declining volume, declining vix, narrowing daily tick range, clown's zone off the top of the hotlist, +60% bulls AAII, all signs of complacency at the top of a bear rally.
The pattern on the nwx is one of a bear flag, which indicates that we should see new lows in nwx, and this leadership should drag the rest of tech with it.
b
i would compare the gaps in the chart as breakaway gaps off the top, just like the breakaway gaps off the 4/4 low, i believe this kind of forceful move indicates lower prices ahead and selling rallies will work better than buying dips, until we see a return of some good bearish sentiment. |
