get ready to ruuuuuuuuuuubllllllllllllllle.
the nasdaq has had 7 narrow range weeks after the spike up out of the april low, extreme low volatility for this index, i'm comparing this to a similar period of 16 narrow range weeks in a side ways consolidation out of the early june 00 move up in nasdaq, which turned out to be a big triangle top in the naz,
we could go sideways for several more weeks but i think we are getting closer to a break out.
the naz has developed a big head and shoulders bubble top with the neckline at 2250, in the third week of may we made a weekly shooting star into this resistance and had a violent pullback with consecutive daily gapping black candles.
stockcharts.com[l,a]waclyymy[df][pb10!b20!a2250][vc60][iUb9!Ll9]
now we've retraced that move and had another failed breakout at 2250 (at least for now),
it is a common pattern for the first retrace to the H&S neckline, to turn down and retest the lows or make new lows.
The build-out of the internet was the big theme in the bubble (but it appears the internet was largely built out during the 90's and of course the crowd only found the technology revolution at the top, when they were gonna get an island domain by buying and holding jdsu, like discover broker ad al the tow truck driver -ggg-)
the internet infrastructure stocks have been the weakest, with continued earnings warnings and downward earnings revisions and gaps down on those downward earning revision.
stockcharts.com[l,a]daclyymy[dd][pb10!b20!a2250][vc60][iUb9!Ll9]
jdsu gapped down off it's indecision triangle and has made a bear flag, jnpr has done the same and has now broken down on the bear flag, sunw did and inverted H&S pattern and did a false breakout in the third week of may and is now forming a similar pattern, nt made a new 52 week low last week, people that ignored these kind of gaps down in late sept, or early feb paid for it big time.
to me it looks like the nwx should be headed to new lows, i doubt the nasdaq can stand such weakness in this group, with so many big cap names.
as it's stands now i think the rumble, will not be a rumbull -g-
for those vegetarians, don't worry i didn't consult the black mystery meatball on this, but tomorrow we melt anyway -lol- |
