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Afternoon Snack


The market is slow today and if feels as if everyone already went on vacation. Tech is clearly the leader on the day as the BTK (Amex Biotech), SOX (Philly Semi), and Internets are leading the charge. The SPX feels like it has reversed (for the time being) and the resistance levels, which I highlighted this morning, have been broken as the market climbs higher. The big talk on the day is Novellus's (NVLS:NASD) mid-quarter update tonight and where traders are going for Thanksgiving. With a slew of economic numbers due out in the next two days, news from NVLS tonight and the fact that many PM's are away, doesn't add up, in my opinion, to an environment where it seems as if taking on high risk will be rewarded.

The DRG (Amex Pharma) is bid up in front of the news that the Medicare bill will be voted on sometime today or tomorrow. The BTK is the strongest index on the day and is pressing up against its descending trend line, which is 458. A break and close above this level may push this index higher in the coming days. The SOX broke out of that descending channel that I highlighted this morning. Look for 516 and then 530 to be the key resistance levels. Remember, NVLS reports its Mid-quarter update tonight and in my estimation, fundamentals certainly take precedent over technical levels. Just because the stock (or any stock in the Semi sector) may look good on a chart, tonight's news will certainly be one of the catalysts that will move the index tomorrow. As I am writing, the market is continuing to breakout. Watch for 1050 to be the next resistance level on the SPX, 9770 on the DOW, and if the NDX can close above 1400 that is a very positive sign.
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