Markets Rage Higher As Technology Continues To Lead
Technology has truly been the leader of this rally over the last month. The PowerShares QQQ Trust, Series 1 (ETF) (NASDAQ:QQQQ) has soared from $42.97 to a high today of $49.65. That is a 15.50% rally in just one month. Truly amazing. Stocks like Apple Inc. (NASDAQ:AAPL) have gone from $235.56 to a high today of $293.53. This is a whopping 25% jump in a month. Amazon.com, Inc. (NASDAQ:AMZN) has also soared, jumping from a major gap down on last quarters earnings announcement. At that time, it opened at $105.80 and today hit a high of $159.76. This is a 51% move.
With all these tech stocks racing higher, the main questions must be asked. How long can the rally last? How high can these go? From a traders perspective the rally is extended. However, what we are now seeing appears to be end of quarter buying by fund managers who want to show they held some of these stocks. This is called window dressing. Tech stocks should be near a pull back range but it may wait until the last few days of the quarter or early to mid next week. In addition, many of these tech stocks have been highly shorted. Each day shorts are being forced to cover and that is adding to the buy side. Add that all into the mix with the fact that economists, the media and the President have been pumping a recovery, it gives u this monster tech rally. Again, watch early to late next week.
Chief Market Strategist