Posted by: jhamon | October 14, 2009

MysteryHedgie On INTC’s Upbeat Words, M&As

INTC’s upbeat words and renewed M&A in the tech sector generally have increased the probability of a volatile upside thrust to global equities as the positive seasonal bias takes hold. We reiterate our idea of 10/8’s note that upside calls, many of which are trading below realized volatility, represent great value/limited risk ways to play for year end acceleration as SPX is primed to test its downtrend line from 2007 (see below).

Interestingly this morning, gold is flat in a positive stocks/weak US$ tape, contrary to the recent correlations. As was the case in late 1999, a technology led equity rally may have the “psychological power” to reallocate funds from other asset classes and other equity sectors.

SPX in an uptrend
SPX in an uptrend

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