We look like we've got a completed impulse up, followed by corrective sideways, and now another completed impulse up, in SOX. I am a little skeptical because I would much prefer to see SOX throw over the 540 level briefly; if that happened on a clean count I'd take another stab at increased position shorts.
For now, I'm just maintaining a moderate position short, awaiting the next signs of weakness. I continue to follow my 1931 model for this as a double zig-zag in techland, and that says we're in the waning days of the "X" wave before the second zig-zag. This actually makes a lot of sense fundamentally since we've finally reached valuations that represent the *starting point* for most prior bear markets. Some moderate overlap of the previous low, now resistance, is to be expected.
The fund flows don't exist to make this thing go much further. If they started materializing, I might reduce position shorts. However, insiders remain heavy sellers, foreign interest is gone, and mutual funds can't be buyers even if the dopes wanted to be buyers. The only purchasers here are shorts and the institutions that keep jamming the futures thanks to that bulge in institutional money funds.
Please, please, please remind me to NEVER ignore a $100B jump in MZM ever again...
BC |
