Hi Reid,
This should help push QQQQ down.
Here's the 1 year weekly chart of the $SOX, with regression channels drawn:
139.142.147.218
As you can see, the semis were turned back from major chart resistance rather convincingly.
The correction may last only until the middle of the regression channel (i.e., currently 400 or so), because if you reset the regression limits to the beginning of the uptrend that began 27 weeks ago, here's what the chart looks like:
139.142.147.218
Note that the lower rail on this chart is now just above where the middle of the regression channel is on the 52 week chart.... that leads me to believe that reversal at the midline of the long-term chart (52 week regression channel) is a likely reversal point.
There was very recently a bull cross in the $SOX, but just barely:
stockcharts.com[w,a]daclyyay[df][pb50!b200][vc60]&pref=G
The situation with the $SOX is a bit confusing. On one hand, if you look at the 2 year chart, you can see that the $SOX is really in a long-term downtrend that began in January, 2004, and that therefore the uptrend that began 27 weeks ago is really just an extended medium-term relief rally within a long-term downtrend:
139.142.147.218
So you could make a case that the $SOX will retest critical chart support at 375, and if that fails, then the long-term downtrend will be intact.
But if you extend the chart and regression channels back to the V-bottom that occurred in October 2002, you see a different picture, with the $SOX in a long-term uptrend, and the lower rail ultimate support being about 350 - 375 by the time the $SOX can trade down that far:
139.142.147.218
So, an interesting picture there, and relevant to QQQQ since the $SOX is an important component of QQQQ... FWIW, I'm still short AMD and holding.
T |
