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Thursday, December 24, 2009

Big Tech Scared of Trendlines (added 2 IBM ED chart)

Looking at Big Tech, a main theme that stands out is that rising trendlines are a prominent theme. The high beta tech stocks are capable of big either direction of course.  Of course when the trendlines break, they can move down in huge chunks.

Looking at this qqqq weekly you can see what I mean.  Arguably the move from March is one gigantic rising trendline considering we really haven't had a hard down move in tech during any of P2.  It almost suggests that when it does someday break, it will break very hard.  Its as if there is a pent up demand to sell.

I must admit when I look at the qqqq's, I see 3 waves down off the peak from the 2007 high.  Well actually my primary count has the wave (5) as a truncation. In this case it fits because the qqqq's probably fell too hard too fast on its wave (3) of P1 in late 2008.  Still the qqqq's are now past the 61.8% Fib marker and   with a lot of tech stocks hitting all-time highs, you wonder if the qqqq's can take out that 2007 peak price.  Of course if that happened then yes we will get that 1200+ SPX score sometime in 2010.

Hey, I may be a bear but I try to keep an open mind.

But then I look at this chart. And yes, its overbought on the weekly with negative divergence. So considering all things, I think there exists great risk in the long side of the qqqq's versus the short. Particularly since the world is screwed and its a matter of time before it comes undone no matter what Timmy and Benny say.

Ahh, the Apple monthly chart.  Putting in the final squiggles on a long-winded cycle up wave. Massive monthly negative divergence kind of clues us in that this is a primary wave [5] peak.  And of course the psychology fits!  Is not Apple on top of the world?  Can they do no wrong?   Is not Steve Jobs invincible? (I mean no disrespect - he is a decent man by all means!)

And the Apple weekly seems to confirm that within wave [5], wave (5) seems to be playing out.  The weaker RSI is a clue its a wave 5 just as the RSI on the monthly confirms the larger degree wave [5]. Very tight channel.

The Apple daily seems to confirm the larger charts. A wave (5) peak coming. Possible thrust move out of a wave (4) triangle.  Either way, the targets are probably not too far off. See that lower triangle boundary line?  Apple doesn't want to break under that, so it bounced off. P/E: 33.23

Ahh, Amazon, that stock that keeps sticking.  No wave count on this 15 minute chart just some technicals. You can see they bought when the downsloping trendline was broken above.  Now an upsloping trendline is in danger of being broken. And the technical weakness seems to point to it breaking. I have this retrace as a wave 2.  It is a nice wave 2, but now it may be unhealthy again. We shall see.

Here is the daily on AMZN. All time high just like Crapple.  And it appears to be "finished".  The whole top formation is one giant puffy dream cloud.  Sure why not? AMZN will earn a nice .45 cents per your $140 stock. What a bargain!  At an 81 P/E, I want more! We all are pretty sure its gonna come back to earth. But just like any stock, the trick is guessing when.  Well, I think very soon. 

Google is the wildcard of the whole bunch.  A week ago I suggested that it may indeed make a new high within 4-6 months.  Maybe an earnings report and it gaps up like a zillion dollars like it did back in the Spring of 2008. I dunno. There is no weakness on the weekly.

Except for two things actually in my opinion: 1) Volume is waning.  But so what I guess we know its on its final run so that only confirms once it puts in its top, stick a fork in it.

2) More interestingly, take a look at that weekly RSI rising trendline. Google seems to be deathly afraid of breaking it by even a smidgen.  So its worked itself up to oversold on the weekly at above 80 RSI!

Hrmm, what if they pull the plug on the internet? What do you suppose Google's price will do if the US government declares a "time-out" on the free flow of information due to civil unrest?  You wouldn't look so smart for having all that high priced stock in your portfolio then will ya? P/E: 39.95.

BIDU's chart looks a lot like Apple's.  I have BIDU peaking in an all-time high.  And its in a retrace mode.  Maybe I'm wrong on this. I dunno, I ain't buying it at $420 and a 93 P/E.   Its like the First Solar of the Internet.

Again, look, another trendline it is trying to avoid.

Ok I know IBM is in the Dow, but its still tech.  Yet another stock that pushed to an all-time high on this P2. But it is showing technical weakness. And yet another trendline it desperately wants to obey! P/E: 13.46...such is life in the DOW.

One interesting note about IBM. I seen a story the other day where they are getting involved somehow in providing mortgage services. ????  WTF?  These corporations need to stick with what they know. But it smells like insider stuff in cahoots with the Government.  They are all crooked aren't they? Just think of GE.

By the way, although I didn't label IBM above, I think its making an ending diagonal push at the top. It might spasm an overthrow move, but that should be short-lived. The danger is that it is a big ascending triangle. But it may be sloping too much upwards. We'll know in a month. If it is a triangle, its the final move anyways.

Actually this one is probably better. Either way, it implies the same thing.

Well thats about it for now. These stocks got to keep on trucking cause they are scared of their own shadow I guess. A kid with a ruler....
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