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Our indicators are giving bullish-to-neutral readings, a slight downgrade from last week’s bullish readings, as market momentum seems to have slowed down a bit since then. However, I am still in the bullish camp, and I believe the market will continue to rally.
The main reason is that the major indices just recently broke out from their very tight trading ranges, which suggests to me that they could keep moving higher for a while. Also, as I often mention, the period of time around the end of the month and the start of a new month tends to be bullish about 70% of the time, as this is when fund managers are putting their money to work.
Earnings have also been coming in positively. The stream of announcements over the past few days has been particularly impressive, with a few of the big tech companies reporting especially strong numbers. This group had been leading the market higher until recently, and it is now doing so again after falling out of favor for a few weeks.
So, today I am recommending a bullish trade in Cypress Semiconductor Corporation (NASDAQ:CY):
Buy to open the CY Sep 15 Calls (CY170915C00015000) at $0.75 or lower.
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