Wednesday, April 18, 2007

Investors Putting Some Chips on INTC?

We've had some recent strength in the semiconductor stocks. Intel (INTC) has been on my radar for the last few days due to a breakout in relative dollar volume flows. Not only are we seeing more investor dollars being put to work in INTC; these inflows are occurring with consistency. Indeed, we've now had 13 consecutive sessions in which dollar flows were above average (i.e., above the 200 day average; horizontal red line on chart) for INTC.

Recall that dollar volume flow looks at whether transactions occurred on upticks or downticks and weight those transactions by their dollar volume. As a result, it's an excellent indicator of institutional interest in companies and sectors. I will be continuing to watch INTC and the semis to see if large traders and investors continue to put their chips to work in the sector.

1 comment:

wcw said...

Folks clearly are buying INTC. Heck, I went levered long some weeks back, when it became clear that they were again eating AMD's lunch. That said, I sold out on the earnings release. I simply don't trust the company's own predictions, and bar that this one was pretty week.

I wouldn't short yet, but give me a good setup and no countervailing data and I'll turn that levered long around.