Monday, August 30, 2010

Stocks- The Weakness Continues


Last Friday we had somewhat of a reversal which caused many traders to think the market put in some sort of a bottom but today's price action quickly reversed back to the downside.

Above is a chart of the NASDAQ and in the lower panel is the number of NASDAQ stocks trading above their 200 day moving average. As you can see, this chart is in a downtrend making lower highs and lower lows. In fact, the number of stocks trading above their 200 day moving average hit a new low for the year today which in my opinion just confirms my bearish outlook. My downside objective is for the NASDAQ is for a retest of the July lows.

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