Of the 6 major indexes we like to follow (S&P500, Dow Jones, Russell 2000, Midcap 400, Dow Trasnports, NASDAQ) could you tell us which is the only one to be trading at 10 year highs? The NASDAQ is the correct answer. The tech heavy index has been on a tear so far in 2012 with QQQ boasting a year-to-date gain of 8%. More important is that QQQ has closed above the $60 level for 4 straight sessions.
During the dot.com bubble of the late 90′s/early 2000′s QQQ soared to an astronomical high of $120. $60 marks the midpoint of that all time high and it acted as stiff resistance throughout 2011. Now that QQQ has cleared this significant resistance it will likely see even more upside momentum as technical traders notice support is closer and closer and resistance is farther and farther away.
A few stocks that appear to be at the forefront of this bullish momentum in the tech space is IBM, AAPL & PCLN. All three stocks have unmistakable long term uptrends in place and are either at or within striking distance of all time highs. They all also weekly options with good liquidity which makes for great day trading opportunities. We recommend continuing to view these stocks, and the tech space in general, with a rose-colored glasses.
On that note, due to the favorable trend in the NASDAQ that we have highlighted, now may be a good time to get bullish on some other notable technology giants. Google (GOOG), Amazon (AMZN), Salesforce (CRM), and Baidu (BIDU) are down anywhere from 15-28% from their most recent 52 week highs. The overall trend in technology stocks is likely to help companies like these find support sooner rather than later.
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- Stockhaven @ the bell 7/27/2011
- SH @ the bell 1/3/2012: The only thing that’s changed is the year; GOOG looks strong
- SH @ the bell 1/4/2012: Some “higher highs” attained, others not yet so
- Stockhaven @ the bell 8/22/2011: Markets enter week in precarious position
- SH @ the bell 9/6/2011: So long relief rally, we hardly knew ya’