Broker (investment advisor): The technology stocks are getting really strong
Client: How strong are they?
Broker: They are so strong even the Mavrix Strategic Small Cap Fund is up this year
Client: Wow – that is really strong - I see the Mavrix Fund Management shares (TSX-MVX) have bounced up to 24 cents and they may be added to the BNN stock ticker just like Allen-Vanguard Corporation (TSX-VRS)
Now for some reality – we at Getting Technical examined the cyclic structure of the TSX Information Technology index and were confronted with a strong bullish scenario. Following a decade of growth in the 1990's the group peaked in 2000 and the great 2000 - 2002 Granddaddy bear introduced a secular down trend which is still in place.
The rules of a secular trend look good for the sector - the secular down trend will have at least 3- bull and bear cycles and one of them (usually the first ) will be a Granddaddy - now we are just into cycle 3 and this could mark the end of the long down trend with a surprise to the upside in 2009-2010 - next blog we look at some small cap tech names
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