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Once the election reaction
was out of the way, it was business as usual Thursday.
That meant more breakdowns in the
leading techs, continuing what began earlier in the week.
Although the bells were evenly mixed, this was
more than offset by a third day of distribution in EMC
(
EMC |
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PowerRating) and the shoddy showing in aggressive growth
issues.
Never mind the lighter Nasdaq volume.
Once a market drops 8%-10% or so off
its highs, it’s best to see volume pick up to indicate real fear among
participants and wash out weaker holders.
Merrill
(
MER |
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PowerRating), mentioned
Wednesday, was another sore spot Thursday.
Of all the glamours, I have been
watching Check Point
(
CHKP |
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PowerRating) the closest this week since it logged one of
the best run-ups off the Nasdaq low of two weeks ago.
To its credit, CHKP ran up 86% in
eight sessions to stand less than 5% off its late-October high during Monday’s
action.
However, if CHKP’s advance since the
Nov. 30 low in the Nasdaq were to amount to something, this was a stock that
should not have given back as much of its gain as it has this week.
If the market were ready to expand on
the Naz’s eight-day rally of 20%, leaders like CHKP shouldn’t have caved over
the past three days.
Again, when a stock does the unexpected,
it’s time to sit up and take notice.
Similar to CHKP in terms of leadership
over the past two weeks is BEA
(
BEAS |
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PowerRating), which ran up 74% in the same
eight-day period.
BEA has now lost 26% thus far this
week.
Some giveback is to be expected.
But 20%-26% pullbacks in leaders such
as these is excessive.
Other names of this ilk show a similar
tape.
And paint a similar picture.