Karpel’s Corner: Tech reads overbought but still bullish

Welcome to Karpel’s Corner. This is where I throw out my thoughts on the markets and share some of my favorite strategies. I keep it market-focused, and  never miss an opportunity to teach trading strategies and commentate on the latest trends affecting the financial markets. Hope you enjoy today’s post!

The $QQQ, the tech ETF, has been in overbought territory since mid-May.

Now the bulls want to see that markets are overbought in trends like we are seeing. Technically, we will be watching some lower studies to help with keeping a pulse on this trend. Specifically, we
will watch the $CCI (20 period for those of you who are wondering) stay above the -50 level.

Large Cap tech names like Facebook ($FB) and Google ($GOOGL) are the drivers in the space, with recent pops over the last two days being a big part of the catalyst in the this sector.

Been talking commodities and the strength that we have been seeing. But one sector that has lagged the Equity markets has been Steel ($SLX). $SLX has trying to break out of a tight range since May,
roughly $46-$48 in $SLX. There is a Bullish formation potentially setting up in the steel sector. Specifically need to see $SLX to break $50, which is in resistance since December of 2013.

There have been a lot of headlines about China and how the Shanghai Composite has been going lower since December. A breakout in the Chinese market could be the catalyst that steel stocks need for
further fuel to the upside. Watch for a break of 2100 and Challenge of 2200 on the Shanghai Index, $SSEC. Thats all for now, good trading to you all.

See you next time at Karpel’s Corner!