Stay On Your Guard
As of this
writing, all you have today is a market that is trying not to go
down. After the past several days, it’s about time it tries to put up a fight.
To be blunt, based on the technical condition of the major indices,
any rally at this juncture is
purely an oversold rally. I would not give it too much weight.
The main point I want to make today — and the one point that really stands out
for me — is that a ton of stocks are breaking down. I am not talking about your
garden variety pullbacks. I am talking about high-volume breaks of support. This
is worrisome and must be respected. Markets, sectors and stocks do not recover
so easily after they break down and usually lead to lower prices.
These breakdowns are happening in a number of sectors with virtually no place
immune. A couple of examples happened today.
Look at
(
TYC |
Quote |
Chart |
News |
PowerRating) which broke $52 support on more than 3x average volume.
(
EMR |
Quote |
Chart |
News |
PowerRating) gaps to a 10-month low on more than 7x average.
Yes, I am finding a few stocks busting out to the upside…BUT…
in measuring of the markets of the past couple of months,
one can’t help but
notice how many stocks tried to break out…only to fail miserably. Stay on your
guard. It certainly seems the markets have a
lot more to deal
with both fundamentally as well as technically before they can get going to the
upside. Tomorrow’s another day.