How about this steady rally? I have no idea what the technical-analyst naysayers are looking at when they say this market is set up poorly into earnings.
The thing you want into earnings is a "rational" market. Rational is in the eye of the beholder, of course, but to me that means you want to see strong reports bought and weak reports sold. AMD (AMD - commentary - Cramer's Take) was weak, and, boy, is it getting sold. Yes, in a classic "flip it" sense, I'm calling AMD's trashing today a bullish indicator for earnings season.
Let's walk this logic out a step further. Because I expect most of my favorite tech stocks (Microsoft (MSFT - commentary - Cramer's Take), Google (GOOG - commentary - Cramer's Take), Adobe (ADBE - commentary - Cramer's Take), News Corp. (NWS - commentary - Cramer's Take), etc.) to report strong numbers and give upbeat guidance, the "rational" reaction to earnings reports and updates makes me pretty bullish into earnings season
At any rate, the continued steady rally action and rotation into tech seem like pretty classic bullish action to start off this year. Listen to what the market is saying, and look at what the market is giving you. That's the key, at least for me into this particular earnings season.
At the time of publication, the firm in which Willard is a partner was net long Microsoft, Google, Adobe and News Corp., although positions can change at any time and without notice.
P.S. Will you be there when Cramer makes his next move?
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Cody Willard Blog The Great Semi Debate 1/12/2007 8:39 AM EST AMD sinks, but the bad news for semiconductors may be almost priced in.
Cody Willard Blog Tech Trend Is Your Friend 1/11/2007 4:38 PM EST No end is yet in sight for the collapsing oil market.
Cody Willard Blog Sticking With the Bull Thesis 1/11/2007 1:39 PM EST However, worries about a near-term blow-off top are creeping in.
Cody Willard is the manager of CL Willard Capital Management, LLC. He is a regular guest on Fox News, CNBC and other networks, and he writes a monthly column for the Financial Times. He is also an adjunct professor at Seton Hall University and the author of TheCodyReport.net, a monthly stock market newsletter. Willard appreciates your feedback -- click here to send him an email.
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