Tuesday, October 13, 2009

INTC Beats But Will It Follow-Through

With Intel up almost 5% after hours, the question that comes to mind is whether it is a breakout or chance to sell? I really don't know the answer to that question, but the elliott wave analysis I presented on Sunday would suggest that it is a chance to sell into strength. This is certainly not an analogous time to 2000, but I do remember vividly when stocks were beating the estimates handily in the spring and summer of 2000 only to be sold hard, so just because a stock beats the street doesn't make it a buy.

When I was talking about the possibility of some dramatic reversals this week, I was specifically referring to individual stocks, and this is the type of setup that I was referring to. Here we are, potentially at or near an intermediate term market top with a large cap stock that has rallied 80% off of its November 08 low that is gapping up into fibonacci resistance (61.8% of 07 to 09 decline). My personal opinion is that if I owned Intel, I would be looking to take at least partial profits here.

Let's see how the market reacts to JPM in the morning too, and of course, there is AMD, IBM and GE among others this week. All I can say is that I am not chasing these guys right now.


dave said...

I thought that i'd read "1080-1100 is significant resistance for the SPX. 1083.40 is the 1.0 ext of the January range, & 0.50 ext of the January high to March low"

Has it been deleted in a revision ?

Anonymous said...

Yes that was in there and I don't recall deleting it. If I did it was an accident.