Near-term oversold but…

Many of the areas that have been hit hard past couple of days are near-term oversold so suspect some bouncing soon but the big picture has not change. In fact, the diverging narrowness (not sure what that means) worsens. While the Dow was down over 160, while commodities got whipped again…while advance/declines were again horrid…while 540 new yearly lows swamped the measly 40 new yearly highs, the market refuses to sell of the glamour growth names that continue to hold up best. We do not need to repeat those names today.

We continue to worry about the deterioration in important areas. Even with oil prices plunging, transports continue to break badly. This cannot be good news. W e are also noticing regional banks rolling over after showing some decent relative strength recently.

We continue to worry about the ultimate outcome of all this narrowness as it looks very familiar…from the 72-73, 2000 and the 2007 period. That’s not to say markets have to be destroyed like they were in those instances but if the bad does not turn, it is only a matter of time until the good finally rolls over.  We suspect this will not happen in December but January?

Next week is the Fed…yippeee!