Not For The Meek
Hey, how’s
your week going? Let’s see. Monday was a holiday. I did the Disney park
thing all weekend. On Tuesday, the market was trashed. The
Nasdaq
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to look bleak for the longs. On Wednesday, the market was still acting like yuck…but at 12:55 p.m., someone turned on a switch. If you decided to take the
afternoon off, you missed another quick move.
What happened? I have no clue. What I
do know is that it was getting too darn easy for the short-sellers. And just when
you thought the market would never stop going down, it fools the masses. Exactly
the opposite of when you think the market will never stop going up…what
happens? It gets trashed.
Much more importantly, to me, not much
has changed. You should get some upside testing here…just on a momentum basis.
But the technical condition does not change in a day. The
Nasdaq
is still in trouble. As I have stated, a ton of important names were wedging up
on light volume after high-volume drops. This almost always leads to further
downside. I would continue to be wary of Technology
and would continue to use bounces for selling in most names…until things
change.
The Dow
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is now showing the most strength of the major indices. In fact, yesterday was a
confirmation of the rally that started on Jan 30. Only one problem; yesterday
was day 15. Follow-through days need to happen within 10 days. It is also a
problem that the Nasdaq and
S&P 500
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confirming the Dow. If they can get a follow-through in the next week, I will
then become more emboldened. Just keep in mind, the Dow is 30 stocks…and with Cyclicals
leading the market right now, I wouldn’t give it too much weight.
I continue to find the best charts in Defensive
(Clorox
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& Gamble
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PowerRating), Kraft
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Alberto-Culver
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(Northrop Grumman
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PowerRating), General
Dynamics
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Lockheed Martin
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extended. In any case…go slow. This market is not for the meek. It tests you
every day. Just when you think a trend is in place…bang! It moves the other
way…and quickly.
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