Last week TAPE showed weakness on repeal and replace health-care issue, in the end it was pulled completely, a stunning reversal of campaign top agenda.
Most pundits were analyzing not enough vote to get repeal and replace thru.
The real issue could be that many tax benefits were coming from this repeal and replace.
Now the question is, where are they going to get savings for tax reform....
Once wall street get the hang of this , we may have serious sell off right thru support.
Dow and S&P 500 tested support and held.
Nasdaq was the healthiest, thanks to SOX.
SOX is the strongest and may give hope from retest of 50 DMA.
S&P 400 & RUT is weak
Oil is weak
Even in SOX many semiconductors are off their highs, except MU & CY
This bull run is getting tired and very few stocks are participating, not a sign of strength.
The question is.....how do we position in this market, staying with SOX is a smart idea, it should recover fast after any selling.
Gold strength also highlights overall market weakness.
We have entered a difficult phase in market, strength should be sold and weakness should be bought, kind of swing trading.
Do not hesitate to take profit IF you have.
Buy the same stock on any pullback.
Keep repeating this sell and buy approach, until there is clarity on tax reform.
Good luck with your own analysis and comfort level.
BLOG does NOT give buy or sell.
Saleem
No comments:
Post a Comment