Markets were strong Wednesday as the Nasdaq is trying to reassert its “leadership” status among the big benchmarks. The tech heavy index is lower by 9.2% from recent all time highs whereas the S&P 500 is 8.7% off its own. Bulls would have liked to see volume a bit more energetic but price action was solid as both the aforementioned averages CLOSED at highs for the session. The Nasdaq rose 2.5% and the S&P 500 by 1.8%. AAPL was a big factor in the Nasdaq’s performance today as it rose almost 4%. News from around the world continues to be fragile with both Canada and Brazil in recession, South Korean exports falling dramatically. One has to continue to lean on a short basis as much technical damage has been done and historically these type of volatile sessions come in bear markets. Vicious counter rallies such as we witnessed today are a great example of what traditionally takes place in bearish market conditions. The tech group overall was very strong with the exception of former semiconductor leader AMBA. The former leader is now 37% off recent all time highs and one has to give credit where it is due and Citron Research where it came out with a bearish note on 6/22 which sent the stock down 21% on gigantic trade. Today for the second time in the last 8 sessions it traded beneath its 200 day SMA intraday only to CLOSE above it. Below is the chart how we examined the name in our Wednesday 8/12 Game Plan.
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