Market Analysis and Summary
The major indexes sold off on heavy volume yesterday, taking the NASDAQ and S&P 500 back below their 50-DMA’s and the Russell 2000 below its long-term 200-DMA. The DOW continued to hold up well above its 50-DMA, but still tumbled 1.24% on heavy volume and closed below its 21-DMA. This raises the distribution count to 9 days on the NASDAQ and 5 on the S&P 500.
Many of the market’s leading growth stocks dropped on heavy volume, along with the major indexes yesterday. Meanwhile, gold rallied and the utilities were some of the best performers of the day. Therefore, as we discussed in the prior report, continue to maintain a defensive posture and minimal exposure. In the meantime, pay close attention to the action of the leaders and keep track of the strongest ones, for when the market turns back up again.
The NASDAQ dropped 1.94% as volume expanded, closed well below its 50-DMA and on the dead lows of the session, adding its 9th distribution day.
The Russell 2000 fell 1.78% as volume expanded and closed well below its long-term 200-DMA.
The S&P 500 fell 1.54% as volume on the NYSE expanded, closed well below its 50-DMA and on the dead lows of the session, adding its 5th distribution day.
The DOW fell 1.24% on heavier volume and closed below its 21-DMA, but held up well above its 50-DMA.