Startling Development! Is the Tech Bull Back??

 Confound it, I hates when the markets start acting against my “assured biases.”  But I’m afraid that in the case of tech, specifically with regard to the Cubes [[qqqq]] and the Composite [[Compq]] , we are looking to head significantly higher ovah heah, if these levels can hold.

Let’s look at the Cubes first, which are my favorite proxy for the tech market.  Here’s the long term weekly look with the fibs thrown in:

 See how even after significant selling volume (red bars below the chart), the Cubes didn’t put in a “lower low” or even revisit the March lows?  That’s bullish.   Note also the approaching 13-34 week EMA crossover… again bullish on a weekly chart.   Last, the long term fib’s 38.2% retracement line looks conquered here.  If it can stay that way, the next test is the higher high (over $50) and then the true highs up at $55.    This all looks like good news for the tech bulls, even to my bearish old self.

Now look at the Nasdaq Composite weekly chart:

Again, note the similarity and differences to the Cubes.   One difference is the Composite came quite a bit closer to revisiting the March lows this last July, before rebounding with the rest of the market.  Significant as well, is that is just edging now above the downtrend line that’s been in place since early November of 2007.   We’ll need to get above that with some significance here- let’s say 2500 if we want this tech bullishness to really take root.   We are already a good distance above the 50% fib retrace at 2039, and that’s a good sign for “da bulls.”   

Also, all the bell and whistle indicators (volume, RSI, MACD and slow stochs) are showing more strength to come here, and the weekly just found some support at the uptrending 34 week ema (which remains above the 13 week EMA — a cross of those to the upside would be even more bullish, imho).   As usual, I believe the trendline and the 38% fib retrace remain our most important barriers, so keep an eye on 2450 and the 38% fib line at 2541 or so.   

My best guess is we will go right to the 38% fib and fail there.   We are still in a bear market, remember, but 90 points of Comp strength is better than a sharp stick in the eye, ovah heah.

Ciao.

 

 

 

 

 

 

If you enjoy the content at iBankCoin, please follow us on Twitter