Sunday, May 23, 2010

Stock Market Video - Outlook for the Week Ahead - 5/23/10

Hi, traders, it's been a while since I put together a video so I figured I'd take a shot for this weekend.  I mentioned Thursday that things were getting so stretched in terms of breadth and indicators that a bounce would certainly not come as a surprise.   Was Friday the start of that bounce is the question?  I don't know the answer for sure, but I do know that if it was not, and if we reverse hard the next day or so and take out Friday's low, we are in for major, major trouble.   It remains a difficult market and unless you're a day trader, staying in cash or at least trading very lightly is probably still the best play.

Part one of the video takes a look at the indices, some sectors, and some of the stretched indicators out there.  Part two looks at potential leaders for a potential rally (hard to believe it could happen right now but you never know and you always want to be prepared).   One thing I will say is that I don't think you typically see a long-term top form this violently - I believe it is usually more of a process where the institutions distribute slowly.   Perhaps the computers are changing that as well.  The volatility we are seeing is reminding me more of October and November of 2008 rather than November of 2007.

To see the video in HD, please click "720p" and "Full Screen" on the video bar - HD will be available after processing.  

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