Here we are in wk 3 of 2011...
Technical picture is getting extremely contradictory...
Dow is @ new HIGHS by Friday's close...
Nasdaq is Down 2.77% by Friday's close....
This is a RARE contradiction in TAPE which needs to correct one way or the other...
S&P 500 was Down .98% by Friday's close......
RSI also presenting a RARE CONTRAST.....
Dow RSI @ 74.15
Nasdaq RSI @ 51.83
IF i have to project how TAPE MAY behave....we MAY test 50 DMA in Nasdaq which is @ 2623.85......Nasdaq closed @ 2689.54...thus a further correction of 65.69 points or Down a further 2.44%......which MAY be a total loss of 142.32 points or total correction of 5.15%.
Many technical outfit are looking for 10% to 12% correction now......???
This correction will allow Dow to come down in 50 RSI area also......
Monday is a CRITICAL day for Nasdaq as it is barely above recent lows.....IF we hold that low or slightly go below & bounce back UP...then we have a short term bounce...which MAY last few days......
Why am i being "technically negative" ?
Because Nasdaq is closing in an extremely negative mode,closing near lows of the day.....that is a "tell-tale" of technical weakness.
IF there is a "oversold bounce", I may lock any gains.....
Market has been strong, so any giveback is to be expected......
Here is my portfolio weighting as of Friday :
FFIV 30.77%
RVBD 25.70%
PCLN 24.81%
MGM 18.72%
My portfolio took a huge beating last week,I am now Down 17.42% for the year.
BLOG does NOT give buy or sell.
Saleem
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