I am a believer that as goes the SOX so does the NDX. The Semiconductor Index ($SOX) closed at a 3 1/2 year low today. Add to that another likely down day tomorrow after disappointing Cisco guidance and we could have the NDX retesting the 1700 lows or even breaking down below. The NDX broke it's 5yr weekly uptrend and trend breaks that have held this long generally have a high probability of moving down further over time.
Another NDX lifter turned poison is GOOG which is trying to hang out in the 500 area after getting the smack-down from 700. Take a look at the price action that took place after the confirmed trend breaks. GOOG, $SOX, and even AAPL are great examples of what we should do once we see trend breaks. Here are the charts to illustrate.
GOOG Daily Chart:
Apple Daily Chart:
$SOX Daily Chart:
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