Jerry Samet
03-06-2012, 11:38 PM
The market took a real hit today. The major averages opened sharply lower and sold off the entire day. The recent pattern of selling off and not being able to rally continued as all the major averages finished near the lows of the day. This is in contrast with how the market had been doing during the rally when it would close strong. This seems to be a change in character, which is something to be concerned about. Volume increased sharply across the board and we had distribution days on all the major averages and they are now beginning to pile up. All the major averages closed below their 21dma's and the small caps slid below their 50dma. The market school model had two sell signals today that brought the count down to two, or 55% invested, and Dr. K's model went to a sell signal. The leaders index declined 1.55% on very heavy volume as the index broke below it's 17dma and there was not a single stock in the IBD 50 that was up. The rally is showing real signs of stress and unless we get a strong rebound quickly we may have seen the top of the rally. Jerry