These Two Major Indices Are Not Passing The Test
The NYSE action has been just fine. The
NEW HIGH LIST for the NYSE has
expanded. Areas like ENERGY,HMOs,INDUSTRIALS and HOUSING have been acting
fine. Yes, volume has been light and without volume, the staying power of any
move right now could be called into question. The bottom line of all this is
to be overweighted in the NYSE-types here. That leads me to the NASDAQ and the
NASDAQ 100.
Very simply, the NASDAQ and in particular, the NASDAQ 100, have shown
absolutely no power during this latest bounce to the upside. Volume has been
light, the New highs have not expanded and the overall looks of both charts
are ominous.
Just compare the S&P 600 to the NASDAQ and NASDAQ 100. Notice the
S&P 600 has
tried to turn the corner but nothing doing with the NASDAQ and NASDAQ 100. It
is my contention that if the selling picks up, the worst place to be going
forward are these 2 areas. The market is a contest…a contest of relative
strength. These two major indices are not passing the test. If the selling
picks up, I expect the NASDAQ 100 to break first as it is the weakest. Support
is 1480. NASDAQ support is 2008. It will be vital for both to hold as a break
would turn what has been a nasty correction to something more ofÂ
intermediate-term consequence.
Â
Gary
Kaltbaum