One step back, two steps forward ?

Market In General

Like an ocean wave, the market will ebb and flow, and today it retreated. Hopefully, not many people are left high and dry.

The ostensible reason was a downgrade of many stocks inside semiconductor sector from an analyst of Morgan Stanley, but there are maybe more than what meets the eye.

Many tech stocks, the star performer of late, were down today, SMH was hit extremely hard, but the retailers, home builders are all up substantially. So, this retreat today was not because people take the money and run, but rather, yhis is because people take the profit and rotate to the laggards in the hope that the strength of overall market will bring those laggerds along.  If this is indeed the case, nothing need to be concerned, rather, this should be a good sign,becaue, it implies that market is trying to  build a broad base.

Also, the DOW remain virtually flat until afternoon, when 14000 level broken and the selling accelerated. I will  not be surprised if many trading programs have following line:
                                     If DOW< 14000 then sell more ..  :)

What will happen tomorrow? hopefully, the DOW will come back to 14000 level, and it is only rational  to assume  those progams with above line in them also have the following line:
                                     if DOW > 14000 then buy  .. 

then, we will be back to where we were again..

Obviously, the hope is just that, a hope.  With all eyes are on friday's job report, tommrrow probably will be a relatively quiet day, and I dare to predicat a slight up day..


STOCK TALK

Lately, there are a lot of talks of Chinese Communist 17th congress.  I begin to wonder what impact it will have on EWT?  maybe it is the time to short it.
     a.  Semiconductor is weak, which EWT almost always associated with
     b.  Sometime in the near future, there will be a shouting match and sabre-rattling cross the Taiwan strait if the history holds, which undoubtly will scare the stock market of Taiwan.
     c.  If you belivee in candlestick, the pattern looks pretty bearish to me...

  (disclaimer..   I do not hold any position of EWT for the present and I may/may not hold it in future).