Hoping for Some Consolidation

While the QQQQ broke above its overhead trend channel and the SMH moved to new highs it would be a bit Pollyannaish to expect gains to go into hyperbolic mode without some pullback or consolidation first. In fact, we would prefer to see gains consolidate for a while and perhaps pull back just sharp enough to scare out the new longs. Up trends are great, but when everyone is bullish at the same time the trend can be jeopardized.