The S&P broke its trend line and is very weak here. Transportation is rolling over, which is a warning sign to the Dow theorists, who need transports to confirm the breakout.
Primarily, we take the market's technicals with a grain of salt here. This is earnings season and earnings season is news-driven, not technically driven. It's hard to get serious about the short side in anything but the weak builders and real estate sectors. It's certainly not a time to get aggressively long either.
As earnings roll out over the next few weeks, we should start to get better set ups once again.
Sector Watch: Metals are mixed now with some industrial metal stocks exhibiting strength and others are under severe distribution. Gold looks to be making a dip in an uptrend. Oil stocks are neutral here. China is now under distribution, but we would hesitate to short it as it can be extremely volatile. Shipping stocks, like metal, are mixed.
The stro
ngest opportunities are now on the short side in the builders and real estate sectors.
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