Jerry Samet
07-27-2023, 06:29 PM
The market put in a nasty reversal today. The major averages opened with good gains on Meta’s earnings and solid economic news. The early gains were strong, especially on the Nasd averages. Selling came in and all the major averages reversed lower and closed low in their intraday trading ranges. The COMPQ and the NDX lost .55% and .22% respectively. The SPX fell .64%. Volume was higher across the board, showing that large institutional players were selling stocks today. It also added a distribution day on all the major averages. Leading stocks did a bit better than the overall market with the leaders index gaining .27% on the day. Early gains were lost here as well with the index closing low in its trading range. Volume was higher, giving the day’s action in the leaders index a look of stalling. The market opened strong with META’s good earnings report and better than expected economic news. The highs were made early and selling came in and drove the major averages lower into the close. It had the look of a pretty ugly reversal. The kind of big red bars on the charts of the major averages are not encouraging. Leading stocks are holding up ok as the leaders index is holding its 17dma and regained its 9dma today, but the rally looks like its under a bit more stress. A couple of the short term indicators I look at have turned lower. Today’s action makes it more likely that there will be something of a pullback rather than just a consolidation. The damage remains limited, but more negative action in the short term is likely. Jerry