After The Bell-Time To Short Semi-Conductors-INTC, AMD, TXN Jan 10th

As we move closer to the high for the year in the S&P,(today reaching my lowest high price of 1290) it's time to begin getting serious about getting short. Today the Semi-Conductor space pulled into view.

Semi companies such as Intel begin reporting earnings middle of next week, into the following week after. Nothing more exciting for me then for stocks to ramp into earnings, and investment strategist(cough) try and front run the numbers such as David Trainer did today:

Buy Intel: a stock for all seasons

Marketwatch Jan 10th David Trainer < http://www.marketwatch.com/story/buy-intel-a-stock-for-all-seasons-2012-01-10?siteid=yhoof2 >
In an increasingly challenging market, Intel Corp. is one of the safest investments with compelling upside potential. That's right, investors get to have their cake and eat it too.-David Trainer

I will make a bet with David that INTC doesn't WOW Wall Street with their earnings report, and notes the strong US dollar, higher labor cost, lack of new compelling tech gadgets over Christmas shopping season as just a few of the reasons.

SMH is the Semi holder ETF. The chart shows the stock has taken out the upper BBands and ramped into overhead resistance levels. Most telling is the R2 figure of 97. Exhaustive study has been done on this, stocks above 98, tend to under perform in the next week or weeks. (Just in time to sucker everyone in for earnings next week)

SOXS is the bear ETF for Semiconductors. Notice our trading RSI<2> indicator is BELOW one. (Love it)

Exhaustive studies show that stocks with one or less RSI<2> readings, tend to outperform the next week or following weeks. Highest Volume by Price is around $55. I look for the shares to ramp to the level without much effort.

Conclusion: Now that the S&P has reach the underside of my top price target range, some short calls such as run, and run fast from Semi-Conductors can be comfortably committed to.

In the coming weeks I expect sell side analyst who believe stocks never go down, will lose their clients a bunch of money.

Tim Kathlina



December 7th After The Bell-On Balance Volume

On Balance Volume defined-Total volume for each day is assigned a positive or negative value depending on prices being higher or lower that day. A higher close results in the volume for that day to get a positive value, while a lower close results in negative value.^[2] So, when prices are going up, OBV should be going up too, and when prices make a new rally high, then OBV should too. If OBV fails to go past its previous rally high, then this is a negative divergence, suggesting a weak move

EDC-Emerging markets-prices higher, but OBV lower lows.

EDZ-Emerging markets bear-lower highs, but new high On Balance Volume. Again, no confirmation of rally.

SOXS-Semi Bear, again as prices pull in, smart money is stepping in and buying.

TQQQ-As the bull etf moves higher, OBV moves lower; not confirming the bull move. OBV shows smart money selling the rally.

Finally the fear gauge measure-VIX. As the market algos push stocks higher on every EU bs rumor, its clear smart money gets more and more nervous. As the Vix falls, money has zoomed in to buy protection.

Finally, per ICI fund flow data out today for fund flows over the last week, average joe American sold a whopping $6.7 billion from domestic equity funds: the most since the week after the US downgrade.

Tim Kathlina