Jerry Samet
03-03-2021, 06:24 PM
The market took a pretty good hit today. The major averages opened little changed, but it was all down hill from there. There was selling into the close and all the major averages finished at or very near their intraday closing lows. The Nasd averages were hit the hardest with the COMPQ and the NDX falling 2.70% and 2.88% respectively. The SPX declined 1.31%. The greatest weakness was in the semiconductor stocks with the SOX off by 3.11%. Volume was higher across the board. It climbed 13.38% on the Nasd and 14.08% on the New York. This was enough for new distribution on all the major averages. Leading stocks were hit hard as well with the leaders index declining 4.35% on the day. The index closed low in its trading range on lower and below average volume. The action of the market was pretty bad today. The major averages are looking worse as all the Nasd averages moved further below their 50dma’s and made new closing lows for the decline. The SPX is sitting right on its 50dma. The leaders index also made a new closing low on the day and its relative strength line is also at new lows. The distribution count is also getting pretty high as it registered five on both the COMPQ and the SPX. It is getting pretty hard to argue that the rally isn’t over. The damage to both quality growth stocks and the major averages is pretty severe and the rotation out of leading growth stocks continued. Most of the stocks that have led the rally since the beginning are breaking down and recent breakouts are failing almost across the board. I would expect lower prices ahead. Jerry