Friday, February 29, 2008

Is This The Next Leg Down For Stocks?



Looks like the NASDAQ is beginning to break down from its symmetrical triangle. The NASDAQ Composite has been weaker than the dow and S&P since the November 2007 high. You'll notice that the NASDAQ is still trading above the January 22nd low but the ratio line in the bottom pane has been making new lows all month. This clearly indicates how much weaker the NASDAQ is compared to the S&P500. My guess is that the tech stocks will lead the market down to new lows. I might consider initiating some short positions in the Q's next week. We'll see how things work out.

2 comments:

Anonymous said...

Kevin,
What signs are you looking for to initiate a short in the NASDAQ?
Thank you in advance, Chris

Kevin said...

I shorted some Q's on the open today...my protective stop is right above 44.50

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