The Stock Indices did not follow through to the upside as Friday’s close suggested. The NYSE breadth reached an extreme low today, as new 52 week lows exploded. While the S&P suggests there is more downside work to do, the NASDAQ was not as impulsive, as it moved lower. At this point, today’s rotation down appears to be a short term pause. However, trading below today’s low with the NASDAQ developing more impulsiveness to the downside would suggest something greater in degree of time and price is beginning.
It has been quite some time since the Indices have had a greater degree time and price correction. Therefore, as discussed in last week’s Briefing, we need to be aware of its possibility. We will be able to tell if something greater is developing by trading and closing below important support levels. So far, that has not occurred.