For the last 4-6 weeks the Nasdaq has been struggling as the Dow has been making new highs. Many of the stock market leaders have been losing their leadership and many falling significantly. The market is being held up by fewer and fewer stocks even as the main indexes still hold over the all important 50 day moving average. As long as the indexes stay above this moving average there is still hope although things are looking worse by the day. In my last report I discussed how most of my readers should still be 80-90% invested. Sad to say because of the leadership stocks giving ground I would suspect that number is now closer to 30-40% as more and more sell stops get triggered.
The chart below courtesy of www.bigcharts.com shows the Nasdaq as it tops out and you can see we have two distribution days as we see much higher volume on those down days. Now is not the time to be a hero, wait for the market to stabilize even if it is still above its moving averages.
Remember this blog site is not a newsletter that promotes stock tips or penny stocks. Rather the idea is to teach stock selection with low risk advice. You can also catch me on Twitter for more regular updates and YouTube for some educational videos. See links at upper left.
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