With the Nasdaq down 1.56% intraday, and the NDX 100 off more than 2%, its time to revisit the issue of sector selection.

We noted earlier this week that Big Cap Tech Continues to Disappoint; Here’s a graphic representation of that:

Russell 2000

Russell_2000

Nasdaq 100 (QQQQ)

Nasdaq_6_months

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Which of these charts is treating your money better? Again, I am forced to ask why guess? Why not wait until big cap tech reveals itself?

John Roque, the excellent Technical Analyst out of Natexis Bleichroeder, uses the following chart to explain that not only is Big Cap Tech not the place NOT to be, but the move against it may only accelerate:

Spx_tech_relative

Category: Investing, Technical Analysis, Trading

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

9 Responses to “Nasdaq Big Cap (Qs) vs Russell 2000: Why Guess?”

  1. Bob A says:

    it’s not over till it’s over, but looking at longer term trend line on russell 2000, like back to 92 or so, appears to be a bit of a bubble no?

  2. Bynocerus says:

    Bob A,

    Back in the 70′s there were a couple of years when the small caps rallied 50% or more. Considering how similar many conditions now seem to be with then, I wouldn’t worry about a bubble just yet, but they sure have run a long way.

  3. GRL says:

    Anyone have any thoughts as we seem to be accellerating our loses (as of 12:27) as we head towards the close?

    Also, BR, how are those VIX calls doing?

  4. Bynocerus says:

    Mentioned to an old buddy of mine that I was getting big time short today. Told him my two worries were that we were oversold and that there was a gap to fill over 60 points above where we are now. His response:

    We can always get more oversold, and there’s a gap that’s never been filled down at Nasdaq 1170. If gaps ALWAYS get filled, well…

  5. GRL says:

    Byn:

    I wish you luck, though I’m not into shorting stocks myself. (I don’t want to “lose my shorts.”)

    I wonder if we are seeing the beginning of what usually happens after a Hindenburg.

    In any case, it is nice to see a little action. The flat to slightly up action, day after day after day, was getting boring.

  6. emd says:

    what the heck happened today?? there’s risk in investing??

  7. Jack says:

    Nice to see someone talk about the divergences between the different markets. I was focused on the dow vs nasdaq, but now i see that theres more to it.

    Today felt like traders finally to a look at the macro picture and realized things aren’t as good as they thought.

  8. jim says:

    Does todays action mean Jeffrey Saut’s “melt up” has been called off?

  9. Abe says:

    When the crowds panic, some smart ones make money.