Thursday, May 25, 2006

Semis Acting As Dead Weight

We are getting a nice bounce today, but the semis are not participating. BRCM and MRVL act very heavy, and I have reduced my exposure to the group.

If we could get the semis to rally, I think the market would head even higher. Also, energy stocks are rallying again, with oil back at $71. But if oil keeps heading higher, that could weigh on the overall market as well. So it's a bit of a balancing act.

Brokers and biotechs are strong today also. GOOG just announced a big deal with DELL, where it will have its search software preinstalled on millions of PCs. This is big news, but the stock is still down. In a better environment, this type of news would send the stock up double-digits.

The put/call ratio is running at a still elevated 0.90. But the VIX/VXN have turned down. Makes me think there is still ample room to rally.

long GOOG


At 11:56 AM, Blogger said...

How are you positioning yourself for the summer, last year the Sell in May and go away adage didn’t hold. Do you believe we have another summer rally this year, or are you selling into any decent bounce in the market?


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