Daily Wrap

Once again tonight, there's not too much I can add to what's already been posted today. There are a few ironies such as the market's performance yesterday as the NYSE was broken for 150 symbols from AAPL to XIV yesterday and today's performance with all major averages closing red as the NYSE was fully operational.

Last night I said the move in trannies, up +3.14% seemed to "Flame Out" as they were the worst performer today, down -2.06%.

Broadly speaking, our entry in to some shorts yesterday was worthwhile as today the market has given up just about half of the week's gains.

SPX, Dow , NDX, R2K and Transports...

Yesterday's Dominant Price Volume Relationship taken with the performance in the S&P sectors and Morningstar Groups led to the following statements in last night's Daily Wrap...

"the Dominant Price/Volume Relationship fits expectations almost perfectly with the SPX, DOW and NASDAQ all coming in at Close Up/Volume Down, the most bearish of the 4 relationships, typically resulting in a close lower the next trading day.

Also helping that sentiment was 9 of 9 S&P sectors green with Industrials leading at +1.98% and Utilities lagging at +.58%

And to seal the deal of the 238 Morningstar Industry/Sub-Industry groups, a whopping 202 closed green, all near term overbought signals typically resulting in the next trading day closing down, essentially what we are looking for."

The $USD saw its second day closing higher, now up +.55% on the week on Euro weakness, this in turn sent commodities lower including oil which suffered after the EIA report this morning, closing at an 18 month low, still there are some near term signals for a bounce.

The pullback we have been expecting, not because of 3C weakness, but base structure weakness, looks to be in the making and we should do well with the near term trades entered, we'll see how they perform on lower prices, perhaps they'll be longer than short term swing trades.

As you saw, Leading Indicators are also showing a move to the downside as well as Index futures which was apparent this morning so I think we are in a pretty good trading position and will be in a better core asset position soon.

As for today's internals, we had a Dominant Price/Volume Relationship in al 4 major averages, 18 of the Dow, 65 of the NDX 100, 900 of the R2K and 227 of the SPX of the 4 categories and this was Close Down/Volume Down which I affectionally call, "Carry on" as it has no strong next day implication like yesterday's dominant P/V theme suggesting a close lower today.

As for the S&P sectors and Morningstar groups, S&P groups were a near flip flop with 7 of 9 closing red , but Utilities, yesterday's laggard leading today at a +.62% gain and yesterday's winner, Energy being the biggest laggard today at -1.90%

As for the MS groups, another near flip-flop with only 23 of 238 closing green today, while dominant, not like yesterday with the 9 of 9 S&P and the P/V relationship so I think we are in good shape for our near term short trades, SQQQ, SPXU, SRTY, SDOW and FAZ.

As I have said all week, I expect a move to last week's lows and a broader base and then a resumption to the rally with a stronger move, that one may be worth buying, this one with such an unstable base was not worth losing the sleep over.

Have a great night and I'll see you in the morning.