Distribution Leads to Correction
Gary Kaltbaum is an investment adviser with over 25 years experience, and a Fox News Channel Business Contributor. Gary is the author of The Investors Edge. Mr. Kaltbaum is also the host of the nationally syndicated radio show “Investors Edge” on over 50 radio stations. Gary is also editor and publisher of “Gary Kaltbaum’s Trendwatch”… a weekly and monthly technical analysis research report for the institutional investor. If you would like a free trial to Gary’s Daily Market Alerts click here or call 888.484.8220 ext. 1.
In my last report, I told you the market was being distributed by the big money crowd and that it was time to take notice. Nothing I have seen changes that opinion and now, it seems the market is about to go into correction mode.
For starters, the market has experienced several big up and down days. This is a characteristic of a trend change. If it occurs after a big drop, the market is about to turn up. In this case, it occurred after a rally.
Secondly, I have a seen a good amount of names break below the all-important 50 day moving average. Typically, major averages follow suit. We have already seen it in the METALS/MINING. We have seen in in the all-important SOX just yesterday. On top of this, there has been a direct correlation between commodity prices and a higher market. COPPER has now broken down. Just take a look at the chart of JJC.
So…to keep it brief, market looks like it is headed into a correction of unknown price and time. I have absolutely no clue how long it lasts or how far it goes…just that it looks to be at hand. I now sit back and wait for those characteristics that tell me the worst is over.
I will have a bigger report this weekend whining about what we continue to see out of Washington on a daily basis as the con continues.
Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.