PRE MARKET

We told you Wednesday, after some suspicious action, that our leaders page did nothing more than get hit down to the 50 day/10 week moving average. This is a place where the boys come to defend or take a powder. Yesterday, a couple of hours in, they defended and this morning, a decent sized gap to the upside as a declining Asia and Europe rally nicely. Why? No clue. We just know that from our studies of hundreds of thousands of charts throughout the years, this area is where it is fish or cut bait. With it being December, markets decided to shrug things off and turn up. After all, the pull back here was again minor.

We always say we can tell by how things bounce/rally after a drop. We now know. Notice the DAX turning up, always important. As far as the SOX, still lots of work to do but notice recent breaks to the upside on TRANSPORTS, FINANCIALS and some RETAIL…look pretty darn good.