YESTERDAY AND PRE MARKET

Futures this morning are way down. Time to do some recapping.

We have told you:

Over 60% of all stocks were in poor shape, trading below resistance and the all-important 50 day moving average. There is a simple thesis behind this. Trading below means you cannot go higher and as more and more names move to the downside, eventually under the weight, things head lower.

Major indices were still stuck underneath these areas but above the long-term support that held on the February 9th big reversal day.

The best areas continued to be the NASDAQ/NDX/SOX/TECH/INTERNET and just below that, FINANCIALS.

The worry has been the narrower and narrower markets as money would flow into select areas. But until they came after these leadership areas, markets would hang in this range.

Which takes us to this week.

Monday gross. Tuesday a non-event bounce…and yesterday, another ugly reversal to the downside. Remember, when a market is up 250 points and finishes down, it tells you that at those levels, sellers have the upper hand.

Which takes us to this morning…a large gap to the downside. Anything is possible in these central bank markets as we have seen plenty of reversals both ways but this morning’s action deteriorates the markets even further. It narrows the market’s leadership even further. And now, there is a decent chance FINANCIALS could be turning down. This would just be another in the negative column…a possible big negative. Which takes us to the NASDAQ/NDX. Both are sitting above support but any ugly from here will take them below. If that occurs, one has to ask where the leadership is.

On top of this, we have told you Europe has been leading to the downside, hardly bouncing while our markets bounced up. The LONDON FTSE is in new yearly lows. The all-important German Dax is not much better. Asia is also in trouble here.

We are constantly bombarded with talk that the market cannot go down because the economy is strong. As we have stated, yes it can. Markets are forward looking, not backward looking.  Please keep that in mind. Anyone noticing as the maniacal central bank raises rates, long rates are actually coming down? That’s a big hmmmm! We have also seen plenty of times markets get in trouble while the economy was sound. Keep in mind, we had a big 15 months into the end of January.

Now watching NASDAQ 7084, NDX 6645, DOW 24,217 and S&P 2647. That’s your next line of support. Keep in mind, that is not the Feb 9th, low. These numbers are that first higher low.

Lastly, and most importantly…as a fiscal conservative, as someone who believes government should not be spending a dollar they did not have, as someone who was confident that once Ryan, McConnell and the rest took over, as someone that thought something would be done about the out-of-control size of government, as someone who thoughT something would be done about the out-of-control deficits and the out-of control numbers ahead, we have two words for you and it is not happy birthday. You both are charlatans. You both let every taxpayer down. If the other party wasn’t so into socialism, I and many others would wish you out of power but you are now nothing more than the lesser of two evils. You have ensured trillion dollar yearly deficits as far as the eyes can see. You have ensured $30 trillion of debt as we move forward. You have ensured that in a few years, the first $1 trillion of our taxpayer dollars will go into the black whole of interest payments. We expected all this from the other party. We did not expect this from you. Or maybe it was wishful thinking all along. And maybe this is what markets are reacting to…