Mr. Nasdaq Waits for Washington

Pink line = average performance of the Nasdaq Composite (adjusted) during a congressional midterm election year (74, 78, etc.).
Black line = $compx year-to-date.

Looking for a moody May?

Blue Light Special

The XLK has formed a cup and handle with a very long base. Will technology lead again?

Go Sox Go, redux.

The signs of a resurgent $SOX first seen in December continues, despite INTC. Despite the negatives and completely contrarian to the conventional wisdom, will 2006 mark the beginning of a multi-year trend into the $SOX? Is the world really awash in oil? Is that why XOM placed a higher priority on share buybacks than exploration in 2005?

Take me to your leader.

With the reversals in $OSX, $HUI, metals and associates, the market is looking for new sector leadership. Possible candidates: $SOX, $BTK and $LUXNI, the nanotechs.

happy days are here again?

SPX:AGG ratio is nearing multi-year highs, implying a rotation into stocks for the near-term?

Say no to drugs

Will the BTK breakout to historic highs vis-a-vis the DRG? Are the billions of $$$ spent on biotech research finally beginning to produce results?

Bear, Interrupted?

NDX hasn't broken down yet despite the increased volatility. Potential false breakout/blow-off top coming before the summer?

Sector Leads

Intellidex Index Leaders:

$DWR Dynamic Retail Intellidex Index 65
$DWY Dynamic Telecommunications & Wireless Intellidex Index 64
$DZL Dynamic Leisure & Entertainment Intellidex Index 61
$DZE Dynamic Semiconductor Intellidex Index 60
$DZR Dynamic Pharmaceutical Intellidex Index 59
$DZO Dynamic Biotech & Genome Intellidex Index 59

Old School v. New School

Today the DJIA gained 1.25% v. the Nasdaq Composite which gained 1.0%. In the recent past, sustained outperformance by the DJIA implied poor returns in the Nasdaq Composite.

Now I know how Baruch felt when he had his shoes shined....

Came across this chart. Makes me never want to use $NASI. D'oh.

Will Rod Sterling pull us into the twilight zone?

In case anyone was wondering:

June 2, 1987, Greenspan nominated as new Fed chairman. day 0. $compx: 413
August 11, 1987, Greenspan confirmed as Fed chairman. +70 days $compx: 449
August 26, 1987, Pre-Black Monday high. +85 days $compx: 455
October 15, 1987. Start of breakdown preceding Black Monday. +135 days $compx: 422
October 28, 1987. Post-Black Monday Low. $compx: 291

October 24, 2005, Bernanke nominated. $compx: 2115
November 16, 2005, Bernanke confirmed. +23 days. $compx: 2187
January 2, 2006, +70 days since nomination. $compx: 2243
March 8, 2006, +135 days from Bernanke nomination (eerily close to March 2000 highs)....do-do do-do do-do do-do

Flashback

A good point highlighted by this chart of 1987 from stockcharts.com: awareness of the trendline breakdown would have kept you out of one nasty downturn. Something to remember as Feb-Oct 2006 may develop to be a most humbling year.

habla espanol?

Surprisingly, I haven't heard much of the following: the "La Nina" climate cycle underway in the Pacific Ocean right now.

History repeating

The word is about, there's something evolving,
whatever may come, the world keeps revolving
They say the next big thing is here,
that the revolution's near,
but to me it seems quite clear
that it's all just a little bit of history repeating

The newspapers shout a new style is growing,
but it don't know if it's coming or going,
there is fashion, there is fad
some is good, some is bad
and the joke is rather sad,
that its all just a little bit of history repeating

.. and I've seen it before
.. and I'll see it again
.. yes I've seen it before
.. just little bits of history repeating




The volatility-adjusted levels of the $OEX and $NDX are at levels not seen since 2000. A sign of hubris and complacency? Time to short $NDX and go long volatility? When is that volatility ETF coming out?

Rolling, rolling, rolling

Distribution in small caps, EEM-components, energy, metals, gold over the past 10 days suggest that the market is rolling over. $64,000 questions: will the market break the December 05 lows?
Will January mark the 2006 highs? Or will 2006 be analogous to 2000 with the year's high set in March-April?