Gottfried, it is very interesting. I have just been going through those from the week between the dates of 2/7/03 and 2/14/03. Friday, 2/14 was a pretty big breakout day for the SOX - up 15+ points/5.8 percent. As usual, there were differences of opinion on what was going on and where we were going from there.
While the SOX bottomed on 2/7/03, it didn't do a great deal until the NASDAQ bottomed on 3/12/03(intraday) and started up from there. Here is a "snip" from Briefing.com's report of Thursday, 3/13.
Message 18698116
< From Briefing.com: Updated: 14-Mar-03 - General Commentary - So is this the beginning of the much anticipated war rally? Will the dollar extends its recovery? Does the chip industry's strong gain (8%) in the face of downgrades to AMAT, KLAC & NVLS, and an earnings warning from CYMI, signal that this influential group has finally bottomed? To say that the Nasdaq's 61 point, 4.8%, gain sparked more questions than answers is an understatement.
We've seen enough big one to two day rallies over the past couple of years to know that it's premature to suggest that this week's rebound effort is the start of something substantial. Nevertheless, we were encouraged by the volume and breadth stats. There were more shares traded on Thursday than in any other session this year. Meanwhile, number of issues advancing thumped those declining and up volume trounced down volume by nearly a 12-to-1 margin. This is the type of buying conviction that has been lacking during all the little rallies so far this year. Now we just need to see some follow through buying.
With scope of yesterday's gain catching many investors by surprise, Briefing.com wouldn't be surprised to see indices extend advance over the next several sessions. However, lingering uncertainties over the Iraqi crisis, a sluggish economy and the beginning of earnings warnings season are all good reasons for investors to play it close to the vest in Friday's action. If indices merely hold on to vast majority of Thursday's advance, sector/market will be in good position to build on momentum of last couple of sessions.
Initial resistance for the tech heavy Nasdaq is at 1354 (200-day moving average)... Though index has briefly penetrated its 200-day moving average on a couple of occasions over the past few months, it has had a hard time holding above this ceiling.... Secondary resistance is in the 1400-1420 area... Nasdaq needs to close above this area in order to alter the bearish technical tone.
On a final note, those groups we profiled as relative strength leaders - chips, wireless, Internet services and software - paced Thursday's big up move. Look for these industries to continue providing leadership over the short-term, with telecom/networking equipment playing catch up if the bullish tone holds over the intermediate-term.
Robert Walberg, Briefing.com>
Don |
