Pay Attention To These Changes
with my sorry New York Giants football team, lots of changes
happening in the market…AND YOU NEED TO KNOW ABOUT
THEM.
I have been highlighting for
you the important fact that while the major indices are doing fine, leading
stocks had started to gag a bit. Now that we are a week past the Thanksgiving
holiday, we can start to see the changes more clearly.
There is nothing wrong with the Dow and
S&P-type stocks. In fact, both of these major indices were at yearly highs on
Wednesday. I don’t believe “the market” is in trouble just yet, but I do
believe we have hit the point where it continues to get tougher, where it
continues to have vicious rotation, and where the market will most likely
not bail you out of mistakes.
It is vital you pay attention and stay ahead of
all the whipsawing in and out of sectors. Here is what I am seeing:
INDUSTRIALS and now OIL-RELATED stocks are
keeping the major indices intact. In fact, I believe the
OIL SERVICES may have just started a decent leg up. Notice how the
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bottomed on heavy volume. I would love to see a light-volume pullback into
support.
7-8 out of 10…but many are too extended to touch and others need work on new
bases. NEW LOWS remain quite low. NEW
HIGHS are still in fine shape but I am now watching to see if the number
starts contracting on any rallies. I have already highlighted for you in past
reports the POTENTIAL negatives that are out there.
But until the market gives more clues of breaking down, it gets the benefit
of the doubt. In my
last report, I wrote these words:
“One last point to make is that the
Disk Drive stocks are toast…(WDC),
(STX),
(MXO),
(FLSH).
Historically, the Semis follow
soon after. We need to watch this closely as the Semis have been a great indicator
for the market.”
did I write those words in my last report, did the SEMIS
go yonk…to the tune of 4% for the
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watched closely as a move below 494.73 on a closing basis, then you get the
first lower low in the SOX since going back to last March. ..and as I have said
many times, the SOX has been a great indicator of market direction.
Other sectors that are now negative and should be avoided until new bases
are made are: RETAILERS — which were blasted
last week, AIRLINES —
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jump — and SCHOOLS.
Until next time,
Gary Kaltbaum