The major averages got smacked sending the S&P 500 index below its 2010 lows of 1,040. The widespread losses coupled with the ominous technical damage effectively ended the latest rally which began with the June 15, 2010 follow-through day (FTD). Tuesday’s volume totals were reported higher on the NYSE and the Nasdaq exchange compared to Monday’s levels which marked the latest distribution day for the major averages. Decliners trumped advancers by over a 7-to-1 ratio on the NYSE and over an 8-to-1 ratio on the Nasdaq exchange. There were only 2 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, lower than the 15 issues that appeared on the prior session. Without a healthy crop of leaders hitting new highs it is hard for the major averages to sustain a rally. New 52-week lows outnumbered new 52-week highs on the NYSE and the Nasdaq exchange.
China Slowdown & Poor US consumer Sentiment Drags Stocks Lower:
Stocks fell hard across the globe after concern spread that China’s robust economy is slowing. China’s leading economic indicators fell and Citigroup (C) said China’s exports will face “strong headwinds” in the second half of the year due to stricter measures from Beijing and the ongoing European debt crisis. This sent the Shanghai Composite Index diving -4.3% to 2,427.05 which was the largest single day decline since May 17 and the lowest close in 14 months.
US stocks continued to fall after US consumer confidence tanked in June. The Conference Board’s index of consumer confidence fell to 52.9 from May’s revised reading of 62.7. The dismal labor market was cited as a primary cause for the ongoing malaise. Elsewhere, the S&P/Case-Shiller index of home prices rose +3.8% from April 2009 which was the largest year-over-year gain since September 2006. The report also showed that home prices in 20 major US cities rose in April from a year earlier as sales got a boost from the now-expired tax credit.
Market Action- In A Correction:
Tuesday’s steep sell off effectively ended the latest rally attempt and sent all the major average back down towards their recent lows. Since the June 15, 2010 follow-through day (FTD), this column has steadily noted the importance of remaining very selective and disciplined because all of the major averages are still trading below their downward sloping 50-day moving average (DMA) lines. Looking forward, the 50 DMA line may act as stubborn resistance and this month’s lows should act as support. It is also worrisome to see the 50 DMA line already slice below the 200 DMA line on the NYSE. This event is known by market technicians as a death cross and usually has bearish implications. Trade accordingly.
Inquire Today About Our Professional Money Management Services: If your portfolio is greater than $250,000 and you would like a free portfolio review, Click Here to learn more about our money management services. * Serious inquires only, please.
Host Of The #SmartMoneyCircle Podcast, Founder and CEO of 50 Park Investments. Adam provides weekly market updates to ChartYourTrade.com readers. He is a FORBES Contributor and is a frequent guest on all the major financial media outlets.
Claim Your Free Guide Today
Give us your email and we will give you the tools to change your life.
Disclaimer: All communication from ChartYourTrade is general in nature and for educational and general informational purposes only. Under no circumstance should it be considered personalized investment advice. All our work is general in nature and not specific to any one person. All the information on this site and/or that originates from us, or any of our partners or affiliates, is for educational and informational purposes only and is NOT a recommendation to buy or sell anything. To avoid any conflicts of interest, we do not have a working relationship with any of the companies mentioned in our work. Furthermore, we may have a long, short, or no position in any, or all, of the names that appear in our work and they may change at any time without notice. Investing and trading in capital markets or using margin carries a high level of risk and may not be suitable for all investors. Leverage can work against you as well as for you. Before you decide to invest or trade in capital markets you should carefully consider your investment objectives, level of experience, and risk appetite, among other factors. The possibility exists that you could sustain a loss of some, all, or more of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with capital markets, investing/trading, and seek specific investment advice from an independent financial advisor and other professionals. Remember all the information we provide is for educational and general informational purposes only and is subject to change without notice.
Stocks Retest Support As The Dollar Advances
Tuesday, June 29, 2010
Stock Marke Commentary:
The major averages got smacked sending the S&P 500 index below its 2010 lows of 1,040. The widespread losses coupled with the ominous technical damage effectively ended the latest rally which began with the June 15, 2010 follow-through day (FTD). Tuesday’s volume totals were reported higher on the NYSE and the Nasdaq exchange compared to Monday’s levels which marked the latest distribution day for the major averages. Decliners trumped advancers by over a 7-to-1 ratio on the NYSE and over an 8-to-1 ratio on the Nasdaq exchange. There were only 2 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, lower than the 15 issues that appeared on the prior session. Without a healthy crop of leaders hitting new highs it is hard for the major averages to sustain a rally. New 52-week lows outnumbered new 52-week highs on the NYSE and the Nasdaq exchange.
China Slowdown & Poor US consumer Sentiment Drags Stocks Lower:
Stocks fell hard across the globe after concern spread that China’s robust economy is slowing. China’s leading economic indicators fell and Citigroup (C) said China’s exports will face “strong headwinds” in the second half of the year due to stricter measures from Beijing and the ongoing European debt crisis. This sent the Shanghai Composite Index diving -4.3% to 2,427.05 which was the largest single day decline since May 17 and the lowest close in 14 months.
US stocks continued to fall after US consumer confidence tanked in June. The Conference Board’s index of consumer confidence fell to 52.9 from May’s revised reading of 62.7. The dismal labor market was cited as a primary cause for the ongoing malaise. Elsewhere, the S&P/Case-Shiller index of home prices rose +3.8% from April 2009 which was the largest year-over-year gain since September 2006. The report also showed that home prices in 20 major US cities rose in April from a year earlier as sales got a boost from the now-expired tax credit.
Market Action- In A Correction:
Tuesday’s steep sell off effectively ended the latest rally attempt and sent all the major average back down towards their recent lows. Since the June 15, 2010 follow-through day (FTD), this column has steadily noted the importance of remaining very selective and disciplined because all of the major averages are still trading below their downward sloping 50-day moving average (DMA) lines. Looking forward, the 50 DMA line may act as stubborn resistance and this month’s lows should act as support. It is also worrisome to see the 50 DMA line already slice below the 200 DMA line on the NYSE. This event is known by market technicians as a death cross and usually has bearish implications. Trade accordingly.
Latest Media Quote:
Want To Jump Start Your Portfolio?
Inquire Today About Our Professional Money Management Services:
If your portfolio is greater than $250,000 and you would like a free portfolio review, Click Here to learn more about our money management services. * Serious inquires only, please.
Here are more articles you may like
What are the Best Stocks to Buy?
What are the Best Stocks to Buy? Selecting stocks that outperform the market over both
Types of Trading Strategies for the Stock Market
Types of Trading Strategies for the Stock Market As a day trader, you buy and
What is Growth Investing?
What is Growth Investing? Investors use a variety of investment strategies to meet their short-term
Adam Sarhan
Claim Your Free Guide Today
Give us your email and we will give you the tools to change your life.
FREE 7 DAY EMAIL COURSE
Learn about Early Entry Points & much more...
© ChartYourTrade | Contact us: website@chartyourtrade.com
Disclaimer: All communication from ChartYourTrade is general in nature and for educational and general informational purposes only. Under no circumstance should it be considered personalized investment advice. All our work is general in nature and not specific to any one person. All the information on this site and/or that originates from us, or any of our partners or affiliates, is for educational and informational purposes only and is NOT a recommendation to buy or sell anything. To avoid any conflicts of interest, we do not have a working relationship with any of the companies mentioned in our work. Furthermore, we may have a long, short, or no position in any, or all, of the names that appear in our work and they may change at any time without notice. Investing and trading in capital markets or using margin carries a high level of risk and may not be suitable for all investors. Leverage can work against you as well as for you. Before you decide to invest or trade in capital markets you should carefully consider your investment objectives, level of experience, and risk appetite, among other factors. The possibility exists that you could sustain a loss of some, all, or more of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with capital markets, investing/trading, and seek specific investment advice from an independent financial advisor and other professionals. Remember all the information we provide is for educational and general informational purposes only and is subject to change without notice.
Charts and Data are courtesy of MarketSmith Incorporated. Join MarketSmith here.
Terms of Service