Ther market suffered an ugly reversal today. The major averages showed solid gains early, but news out of the Middle East started a wave of selling that lasted into the close. All the major averages finished near their intraday trading lows. The COMPQ and the NDX fell 1.40% and 1.55% respectively. The SPX declined 1.23%. Volume was higher across the board, producing a new distribution day on all the major averages. Leading stocks had a bad day as well. The leaders index fell 2.37% on the day. The index closed low in its trading range on higher but below average volume. The market had a nice rally going today but it reversed lower on news from the Middle East. There was real damage done today as the major averages fell below important support. The major averages broke below their recent consolidations and are close to their 50dma’s. A break of this important moving average would be very bad. It looks like the market is resolving its recent consolidation to the downside. Protecting gains from the rally is now paramount. Jerry
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