A Look at the Nasdaq
posted Sep 15, 2004 at 11:51PM
One Year Daily
Three Year Daily
The conventional measured move target for the broken channel gives a target of just a touch over 1500.
With the exception of energies, nearly every equity index I look at is trading under its 200 dma, with its 50dma under its 200 dma, and under the bounds of intermediate term down trend lines.
Yet, subjectively anyways, there seems to be no shortage of excited bulls. And of course not all of the them are idealogues....there are top names that say that this rally has lots of legs.
To me a "wall of worry" are anticipated fears which don't pan out...softening job and economic numbers, earnings warnings, sky-high energy costs, rising short term interest rates.
Well all of the above ARE happening.
Not to mention the horrible condition of the US books, geo-politics and the potential of a close election ripping the US apart.
As for the Nas itself...well the overbought stochastics suggest at least a short term pull-back is due... one will have to look and see if it has a corrective look to it...or whether it starts moving down impulsively, and act appropriately.
Although things seem relatively stable enough for short term opportuniistic trading, I, for one, cannot convince myself that it is time to make large bets with an intention to hold.
Some beaten up natural gas and commodity explorers which have been severely beaten up over the past year are what are holding my attention for now. As always gold on the watchlist
But Caution towards papaer is due. The deflation dragon is not yet dead.