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A LOOK AT THE NASDAQ COMPOSITE

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The NASDAQ Composite is now in danger embarking on an extended move lower. Quite simply, we use the 25-month month moving average to demarcate the difference between bull and bear trends; and given the Composite is trading only 22 points above this level within the context of an RSI breakdown...increases the odds that this level will indeed be violated. We don't know how to be more simple than this.

To take advantage of this decline; we are in the process of putting on short positions via semiconductor equipment-makers such as Cymer (CYMI) and Lam Research (LRCX), and also looking to put on a short position in SanDisk (SNDK) in the very near future. These issues should lead the decline; and are quite far off their representative October-2005 lows.


Chip Anderson
About the author: is the founder and president of StockCharts.com. He founded the company after working as a Windows developer and corporate consultant at Microsoft from 1987 to 1997. Since 1999, Chip has guided the growth and development of StockCharts.com into a trusted financial enterprise and highly-valued resource in the industry. In this blog, Chip shares his tips and tricks on how to maximize the tools and resources available at StockCharts.com, and provides updates about new features or additions to the site. Learn More
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