Yesterday and Pre Market

Futures up a wee bit after a rough day yesterday!

Before yesterday:

About 55% of all stocks in our universe were below resistance and the 50 day average.  Quite a few are much worse.

There remain many bearish areas like real estate, utilities, housing, energy, oil & gas, a ton of consumer staples, a bunch of commodity names, Europe…

Many of these areas are oversold and can bounce but main trend remains down.

We have told you for a few weeks how the market has become narrower and narrower with a good portion of money flows going into the NASDAQ/NDX/SEMIS/GROWTH/TECH/INTERNET and to a lesser extent, FINANCIALS.

Yesterday, those areas were clipped. To be blunt, this market cannot afford to lose those areas. At the close, the NASDAQ/NDX hit the 50 day (almost to the penny) and bounced. We make no prediction but make a statement….it had better hold. The SOX did not get back to the 50 day, not even close. It remains strongest but still extended.

We did want to mention that small caps feel like they have better relative strength right now…RUSSELL 2000 holding the 50 day.

The XLF fell below the 50 day but nothing fatal just yet.

Yesterday was another bending day in the market. We are watching those 50 day support levels for those important areas. Most everything else is below and dealing with what we call “no man’s land” in between the 50 and 200 day.