Jerry Samet
08-02-2025, 10:36 AM
The cracks in the rally got a lot bigger yesterday. The major averages sold off hard on a weaker than expected employment report. The major averages opened lower and sold off most of the remainder of the day. All the major averages finished low in their intraday trading ranges. The COMPQ and the NDX fell 2.24% and 1.96% respectively. The SPX lost 1.60%. Volume was mixed. Leading stocks were hit as well. The leaders index fell 1.50% on the day. The index closed in about the middle of its trading range on higher and slightly above average volume. The market reacted very negatively to the employment report. The selling lasted all day and the losses were significant. The major averages cut through their short term moving averages as well. The short term indicators I look at turned lower earlier in the week and the weekly Coppock is clearly rolling over. It would take a strong rally next week to prevent it from turning down. The sell signals on this indicator are not as good as the buy signals, but they can tell you that the rally is losing momentum. The news next week is much less with few important economic numbers, but there are some important earnings reports. This is a time to be much more cautious. The rally is on thin ice right now, and while it could right itself, now is the time to try to preserve the gains made since the rally started in April. Jerry