Leaders Index 6-10

The market had another bad day yesterday with all the major averages down about 1.5% on the day. Volume increased across the board so the was distribution everywhere. They also were weak going into the close and finished at the lows of the day. The leaders had a rough day also, dropping 1.77% on lower but still above average volume. Everything made new lows for the correction and the Nasd broke through the 8% level. Research done by Ian Woodward has shown that about 75% of all corrections are contained at the 8% level. Once that level is broken an intermediate correction of between 12% and 15% usually occurs. I think we are looking at at a minimum of that. Evidence is mounting that the cyclical bull that began in March 2009 is over and we are in the early phases of a new bear market. We can't know in advance how far this will go of if the government will try prevent(or more likely delay) it, but extreme caution is warranted. Jerry