Vertigo Yet?

Up 168…down 158…down 252…up 370…down 117 after being down over 200. Welcome to the nonsense. But for us, these recent wild swings are less important than the big picture and that remains the narrowness in the market, that if not broadened out, will eventually come back to haunt the market as it always does.

Nothing changed on Monday. The bad got badder again while most of the good pulled in. We have to make note of the misery in energy which should teach all of you a lesson. Many famous hedge funds have been rocked because of the energy crash as they have held on believing eventually things would turn. If there is anything we have learned through our years in markets is that low can go much lower and high and go much higher. Those who argue with this mantra will eventually get run over.

Mid-caps and especially small-caps continue to underperform badly while the new highs vs new lows continue to be a horror show. A the close of today, there were a whopping 509 new yearly lows on the NYSE and NASDAQ and only 90 new yearly highs. Granted, a lot of the new lows are commodity-based but they all count.