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The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex

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...If the dots don't connect, gather more dots until they do...




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Saturday, November 24, 2012

Social Media Stocks/ETF

Due to the recent activity in some of the cheaper, beaten-down Social Media stocks and ETF, as well as RIMM, as shown on the Daily charts below, I'll be monitoring this group over the next days/weeks. I'll be looking for any parabolic rise and climax on high volumes on stocks such as these as a precursor to a potential major market trend reversal. If this type of stock continues to explode higher in the near-term versus value stocks, I'll also be warned of potential Q4 earnings weakness (markets favouring beta-movers versus actual value).

To illustrate what I mean, the following graph shows the decline of these stocks from the date of  Facebook's IPO to this past Friday. Percent-wise, ZNGA and GRPN have been the biggest losers, followed by FB and the Social Media ETF (SOCL).

The next graph shows the level of interest in these stocks/ETF compared with the Major Indices over the past two weeks...quite a stark contrast. Whether this continues, remains to be seen.