Jerry Samet
08-09-2023, 06:30 PM
The market put in another negative session today. The major averages opened little changed, but quickly sold off. After a rally attempt more selling came in and all the major averages finished near their intraday trading lows. The Nasd averages were the weakest as tech stocks continued to sell off. The COMPQ and the NDX declined 1.17% and 1.12% respectively. The SPX fell .70%. Volume was mixed, higher on the Nasd and lower on the New York. This produced a new distribution day on the Nasd averages. Leading stocks were hit hard. The leaders index fell 4.71% and closed just below its important 50dma support level. The index closed in the lower half of its trading range on higher and above average volume. Much of the decline was due to the 23.39% drop in SMCI. The market session was pretty negative today. The market rallied after early weakness nut unlike yesterday it couldn’t hold it. The distribution count on the Nasd averages is now seven, a high number. The Nasd averages also closed just below their 50DMAs. Leading stocks are breaking down almost in mass, which is also very negative. There are many signs that the rally is over and we are more likely looking at a correction instead of a consolidation. If that is indeed the case the next step is to see how far the correction will go. The vast majority of correction are contained at the 8% down level. This is a real line in the sand between a more moderate correction and something more of the intermediate term variety. The 8% down level is the key. Jerry