Tuesday, May 04, 2010

Stocks Tumble On Heavy Volume

Stocks got hit hard today with the Dow Jones Industrial average down 225 points. Some of the weakest groups leading the indices lower today were the Airlines ($XAL) down 5.38% and the semis ($SOX) down 4.53% .

In the above chart of the SPDR S&P 500 ETF (SPY) you'll notice that support was found at the 50 day moving average. The NASDAQ (QQQQ) also found support at this popular average. One thing that stands out in my opinion is that we are now seeing heavy volume take place on the down days. Over the past 2 weeks the 4 heaviest volume days all took place on down days. Usually a series of down days accompanied by significantly heavy volume is a bearish sign for stocks which is what we are witnessing take place right now.


Anonymous said...

What do you think of the 30yr Treasury? The yield has a nasty drop today.

Kevin said...

Probably because many people are questioning if Greece has the resolve to make sharp spending cuts so as a result we saw safe-haven buying in bonds today.


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