BIOTECHS AND GOLD SURGE -- SOX BREAKS OUT -- DISNEY AND HEWLETT LEADING DOW HIGHER
NEWMONT MINING NEARS MAJOR BREAKOUT... Our mid-day update talked about the ECB rate cut actually boosting the Euro and the price of gold today. The dollar fell. As a result, gold prices gained $5.00 and gold stocks jumped 4%. One of the best performing gold stocks is Newmont Mining, which is the world's top gold producer. The daily chart shows NEM having broken through overhead resistance near 30 to register a new 52-week high. Upside volume was good. The weekly chart (Chart 2) shows NEM nearing a challenge of last spring near 32.5. If it gets through that barrier (and we think it will), that would represent a very bullish breakout. Chart 3 shows why. Newmont has been trading sideways since 1998 in a major bottoming formation. A decisive close through last year's high would put NEM at the highest price in five years.
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BIOTECH INDEX JUMPS 5% AND HITS NEW HIGH... The BTK was the top performing market group today. The daily chart shows the BTK hitting another 52-week highs. Three of the top biotech gainers that also hit 52-week highs were Biogen, Medimunne, and Protein Design Labs. Biogen has just broken through the highs of last November. Upside volume was strong throughout the entire group.
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SOX BREAKS OUT... We mentioned yesterday that the Semiconductor (SOX) index had hit the highest close in almost a near. Today it closed at 395 to exceed the intra-day high formed at the start of December. A higher close on Friday would complete its upside breakout.
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DOW HOLDS OVER 9000 -- DISNEY AND HEWLETT LEAD... Yesterday we were happy to see the Dow close over the 9,000 level. After a shakey start today, we were also happy to see the Dow stay over that psychological level. It only gained a couple of points, but we were still impressed. A higher Friday close would be even better. Yesterday, we mentioned Disney and Hewlett Packard as two of the Dow's strongest stocks. They were leaders again today. Both Dow leaders have broken through their December highs to achieve bullish breakouts.
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