2012 – The Year of Technology Stocks

Seventeen days into 2012 and it is clear that Technology stocks are back in favor with the investment community.
The Chart at the top of this article  is a 3 month chart of the technology weighted  Nasdaq.  The Nasdaq spent the majority of December in a consolidation pattern while recovering from a 10% correction from it’s August highs.
Beginning in January the Nasdaq has shown remarkable strength.   Notice how the index is closing near it’s high nearly every day since since the market opened on January 2nd.  Volume has been consistent.  The action since the beginning of January is a classic sign of shares being accumulated – good volume, shallow dips that are bought and closing at or near the days highs.
The Nasdaq is on one of it’s classic runs where it does not give the short term trader types much of an opportunity to get in.  However note how the index is getting a bit ahead of it’s 10, 20 & 50 day moving averages.  It would be wise not to chase prices at this point, better times for an entry point should emerge over the next 10 days.
The technical indicators all point to higher levels for the Nasdaq index over the coming  2 – 3 months.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

  • Reliance Investment Management LLC is a Registered Investment Adviser in the State of Washington. The adviser may not transact business in states where it is not appropriately registered, excluded or exempted from registration. Individualized responses to persons that involve either the effecting of transaction in securities, or the rendering of personalized investment advice for compensation, will not be made without registration or exemption.
  • This communication reflects the opinions of Reliance Investment Management LLC and is being provided for informational purposes only and is not intended as a recommendation, an offer or solicitation for the purchase or sale of any security referenced herein or investment advice. It is being provided to you on the condition that it will not form the primary basis for any investment decision. Reliance Investment Management LLC and its affiliates may have positions (long or short), in securities or options on such securities referenced herein. The information contained herein is of the date referenced and Reliance Investment Management LLC does not undertake an obligation to update such information. Reliance Investment Management LLC has obtained all market prices, data and other information from sources believed to be reliable although its accuracy or completeness cannot be guaranteed. Such information is subject to change without notice. The securities mentioned herein may not be suitable for all investors.