A week ago Friday the NASDAQ put in an “outside reversal” day – this is approximately a day where the trading range exceeds both the prior day’s intraday high and intraday low, and then a close below the prior day’s intraday low. See our NASDAQ chart from a week ago below:
This is often a quite bearish signal, but the market has been so immune to any real selling for so long, it has been difficult to take anything “bearish” seriously. (Which in and of itself should be a contrary signal to be bearish!) It is comforting to see the market act somewhat normally, despite the flood of money central bankers have put into the market month after month for years. We actually saw NASDAQ stocks get hit this past week – woo hoo! Not that there was any major damage, but still it was nice to see technicals work a bit. That said, the S&P 500 continued on pace — the NASDAQ had simply gotten way too overextended so a bit of a “rubber band snapback” happened there.
Anyhow back to your normally scheduled bull market….Continue reading