Barron’s Picks-Up on My End-of-Tech-Rally Theme

Two days ago, I posted about how I thought that the waves of retail buyers coming into tech were receding in number. Today, Barron’s picked up the theme with “The Tech Rally is Likely Over“.

You read it here first!

But is the tech rally really over? The Barron’s article uses a technical chart analysis to make its call. However, the NASDAQ-100 and Russell 2000 charts are in far better shape than the S&P 500′s chart, which is a wreck – no doubt because of all the big financial stocks included in that index.

I think that the end of Jim Cramer’s “Mutual Fund Monday” today proves my thesis. There was obviously less retail money that came in over the weekend and the QQQQ and IWM paid the price. They should have been able to do relatively better than the S&P since today’s news was all about the lame financial sector. In fact, IWM did squeak out a victory over SPY today, but QQQQ brought up the rear.

I think a very large dent has been put into the wave of retail money coming in, but there may still be a little more coming. QQQQ and IWM could still attempt a stab higher – especially if we get another doctored jobs report on Friday.

I am short the QQQQ and IWM via QID and TWM and will probably deploy my remaining cash into those two positions. However, I am mentally prepared to take some pain through one last rally attempt. This is an election year after all, and a lot of nefarious things will continue to be done to keep the balls in the air just a little bit longer. Though I do think this year will look more like 2000 than the other election years in history – eventually.

This entry was posted on Monday, June 2nd, 2008 at 10:17 pm and is filed under Investing. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.