Thursday, April 9, 2009

Short memories? Wells Fargo "Profit"

"Wells Fargo projects record $3 billion 1Q profit" or have investors forgotten about the $25 billion bailout the bank received? Not that it mattered; markets have taken this as a positive and pushed an early 3% gain. WFC gapped well over resistance and although down from its open is nicely positioned to challenge $21.45 resistance.

Ignoring the 66% of Nasdaq stocks trading above their 50-day MA which suggests an intermediate top marking a 3-6 month high is imminent (bear market tops typically occur when 60% or more of stocks trade above this average), there is a nice play at work in the semiconductor ETF. The past 4-months of consolidation looks to be history and there should be good demand on any drop below $19.30. Next resistance around $21.10. I've made a whimsical call for a push to resistance with a stop below $19.30; register to make YourCall.

Dr. Declan Fallon, Senior Market Technician, the free stock alerts, market alerts, and stock charts website