How high Nasdaq can go in this run ????

Nasdaq is leading all indices in current UP move.....

Nasdaq has gone from 2099.29 only seven weeks ago to 2468.77 a straight UP run of 369.48 points or 17.6%.....based on long term gains of major indices of 5% to 7% in a year..this is a stunning move on an annualized basis..a whopping 130.7% annualized.....

RSI in Nasdaq is @ 72.94

Next question IS...can we move further UP.....???

The answer is YES...we CAN......

Next move UP is resting on the shoulder of AAPL ER....

IF ER is way above expectations/whisper number..then Nasdaq can easily go to 2525 area..which is another 2.5% move UP......

BUT ...IF AAPL ER is slightly above expectations ...watch out below..a quick pullback of 7% in a hurry...

Talking of AAPL..there is official guidance by AAPL....plus there is consensus estimate..then there is "high number".....let us look @ all those numbers :

Sales by AAPL $18.00 Billion/ Consensus $18.76/High estimate $21.49 Billion

EPS by AAPL $3.44/Consensus $4.03/High estimate $4.73

Gross Margin by AAPL 35%/Consensus 39.2%/High estimate 41.2%

AAPL is priced for perfection which means that AAPL needs to report $21 Billion in Sales & $5.25 in EPS...anything less we MAY be looking @ a quick ride Down to $290-$280 area

Looking ahead AAPL Q1 which starts in Oct will be a very strong Q.....which means any selling in AAPL shares should be a "great buying opportunity"

SO..you can see predicting AAPL ER for Q4 may not be as easy as some traders think.....

There were some challenges in this Q4..Like "antennae problem which affected Sales momentum"...plus there was a cost of Bumpers for Iphone4..plus there was shortage of parts.....all these MAY impact Sales & Margins...by how much??? nobody knows !!!!!

Back to markets...they ARE giving mixed message already....internals are not strong.....which is a first sign of overbought condition.....

I personally do not fight for the last $......

@ this stage in market it is PRUDENT to reduce exposure & book profit....

I have set aside only 40% exposure which is not fully allocated on most days..currently 30%...

SO..you have to decide..how much RISK you want to take when markets have moved UP so much.....

I have learned by mistakes to REDUCE exposure @ higher level.....

NO.. i am NOT right sometimes BUT my view of Allocation & market is mostly close to being PRUDENT....

Many market Gurus got this market 100% wrong like Prechter,Rosenberg,Adami & lately Carter Worth & Doug Kass who both predicted TOP near 1130.....

When professionals get it WRONG most of the time what makes anyone think they can be more right????

Good Luck with your OWN exposure & market RISK......

BLOG does NOT give buy or sell.

Saleem