SPX: has recovered 2/3 from its lows suggesting upside move reward is limited. While 1300 remains key resistance level especially with high reading in the open interest data.
1297 finish slightly below with option expatriation coming up. Rather short Friday and thesis seems back in gear.
Beta related themes: Have been deeply oversold and about 1/3 recovery from July lows. Example includes Russell Small Cap where less liquid names have underperformed.
Given that data, the sideway market action continues despite strong argument from bulls the past two days.
Markets remains oversold especially given the intermediate-term moment data. And near-term entry point is not that attractive.
SOX- has been so beaten up, potentially opening up an opportunity for an upside move back to the 200 day mva.
Same theme in OSX, other tech related themes, Small Cap- less liquid names and beta related themes.
Brokers and gold related themes looks attractive among the beta themes but will be looking for shorts.
Thursday, August 17, 2006
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