Knock yer SOX off.
A shout out to Norman for alerting the board to the soaring SOX. Here is a stock that is more overvalued by far than it was before the February collapse.
It gaped to a new all time high, perched well above the Bollinger band (like a fish out of water ) and far above the 50 and 200 day moving averages.
It closed with a shooting star candle, uber bearish! Here it is on a daily chart:
It seems inevitable a correction must follow – a correction both sudden, swift, and deep. My concern, and the focus of most of us here, is for the miners. The February stocks melt down was unkind to the miners. Should another stocks melt down happen in the near future, will the precious metals and their miners be again dumped to cover margin accounts?
The sell off in the senior miners these last two weeks needs to be addressed. Why the senior miners and not (yet?) the juniors? First, who has been buying the seniors, bidding up the price? Deep pockets, that’s who – hedge funds, bankers, pension funds. The so called “smart money.” So deep pockets must be the sellers. What do they know?
Here then is the question – The senior miners, and the miners in general, do they present a buying opportunity, or are they the first wave of selling by folks getting out early? Inquiring minds need to know…
Whats the measured move to the upside if that neckline holds up? YIKES!
A correction could be in cards.. gap around 1875? Notice though no bearish divergence with rsi. I’d like to see a continuation run up.. with a decreasing rsi.. then we’d have a perfect setup for a sustained down move.
I believe all asset classes are trading together. If the stock market pulls back I am assuming the miners which are trading like “stocks” will go down also. Look at TLT over laid GLD on a chart and you can see TLT leading GLD down.
The DSI on the NDX is 90.