Jerry Samet
10-29-2018, 07:39 PM
The market staged a nasty reversal today. After opening higher the major averages looked like they would stage a solid rally today. With just a half hour into trading the major averages started selling off and went on to close with significant losses. The selling accelerated after there was talk of more tariffs and then closed off the lows of the session. The Nasd averages again took the brunt of it with the COMPQ and the NDX off by 1.63% and 2.02% respectively. The SPX declined .66%. They all closed in the lower half of their intraday trading ranges. Volume was lower across the board, about the only positive to come out of today’s action. Leading stocks sold off as well with the leaders index lower by 1.20% and closing in the lower half of its trading range. Volume was lower but well above average and the index tagged its long term 200dma. The market at this point is showing uncommon weakness. Even after a significant decline it just can’t rally. All the major averages and the leaders index made new intraday lows today. The market is heavily oversold right now and it just can’t rally. Early in a bull market the market becomes overbought and just stays that way as it continues to advance. On the other hand, early in a bear market the opposite is true. The market becomes oversold and just stays that way as it declines further. It is looking more and more like the latter is the case. The COMPQ is down around 14% peak to trough right now. That is a good chunk of the road to 20%. Jerry