Wednesday, February 9, 2011

The “Echo” Tech Boom

As noted before our anticipated A-B-C correction is postponed as the U.S. FED continues to throw dollars at the capital markets with QE causing the U.S. to export food inflation which will likely end with a bubble. The hot commodity space has pushed the Reuters/Jefferies CRB Commodity index above the pre-crisis 2008 peak. Don’t let the hot commodity space distract you from other opportunities out there

Did you know that the Nasdaq 100 index is also trading above the pre-crisis 2008 peak? 

This recovery beats the Dow Industrials, the Dow Transports, the S&P500, the TSX Composite and the Russell 2000 and the red hot TSX Small Cap Index. Our monthly chart of the Nasdaq 100 displays the first technology boom & bust of the late 1990’s and now the second or “echo” boom. Note the break up from that huge 2008-2010 inverse Head & Shoulders bottom.
The recovery price target of 2860 is 61.8% retracement of the first boom and bust. That gives us about 20% upside from here – have fun but be nimble


Shawn Severin said...

Great call on the NASDAQ Bill. Tech is my core holding in my portfolio.

What does your momentum analysis tell you about China (FXI) and Brazil (EWZ). These ETFs are getting hit lately. Is this just a short term blip or the beginning of something else?


Shawn said...

Hello Shawn

Most of the Emerging indices are operating inversely to the mature markets based on the weekly cycle
A commodity correction will get these markets going again - I would hold

Bill Carrigan