Jerry Samet
04-18-2015, 11:05 AM
The market really got slammed yesterday. The major averages gapped lower at the open on news from overseas. China loosened rules on short selling while restricting margin buying. Also there was more about Greece not being able to meet debt payments. It is amazing that there are still people who haven’t heard that Greece can’t pay it’s bills. World markets sold off and all the major averages closes with significant losses. While they closed a bit off their intraday lows, the SPX declined 1.13% and the COMPQ fell 1.52%. The SPX is now back below it’s important 50dma while the COMPQ is slightly above this support level. Volume went up a lot yesterday, based somewhat on an expiration day yesterday, but it still added a distribution day across the board. Leading stocks got hit as well with the leaders index falling 1.74% on higher but slightly below average volume. This shows distribution in quality growth stocks. The index traded below it’s 17dma during the session but closed right on this important support level. In the recent past news such as we saw yesterday has created a short sell off that didn’t last long. One day a sell off like this will turn into something more serious, but we can’t know in advance when that will be. For now we must see the major averages and leading stocks recover quickly and with some conviction to keep the market out of real trouble. Jerry