It usually gets interesting when I am away. The market sold off hard in the last few days. Today saw selling around the world and the major averages opened sharply lower. The lows were made early and there was an attempt to rally but it didn’t amount to much. The major averages finished mostly in the upper half of their intraday trading ranges. The COMPQ and the NDX fell 3.43% and 2.96% respectively. The SPX lost 3.00%. Volume was higher across the board. Leading stocks got hit as well with the leaders index falling 1.90% on the day. The index closed high in its trading range on higher and above average volume. The market sell off intensified in the last three days, especially today. The market is now clearly in an intermediate term correction. In the case of the NASD averages it is reaching the outer limits of an intermediate term correction. The COMPQ is down 13.23% from its highs. The SPX is off about 8.5%. There are some conflicting indicators, but most are pointing down. This was an ugly day all over the world. Nothing was spared, even gold and digital assets. The market needs to rally here. After the weak employment report on Friday everyone is now more worried about a recession. The key right now is the 50dma of the major averages. They must overcome this important resistance for any kind of a rally from here to be successful. We are in a seasonally weak period and I would not expect to see any real rally start until after the August and September period. Jerry
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