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Monday, September 25, 2017

Daily update 9/25 4-Warnings For The Bull Market

Selling in QQQ was very pronounced.

There was some selling pressure this morning as things heated up with NK again.  However, the dip buyers showed up to get SPX well off its low by the close.  SPX closed below 2500 for the first time since closing above it earlier this month.  Breadth was +53%.  New highs were stable at 130.

The futures tested above the 20 SMA overnight, but failed to stay there.  They tagged the 50 SMA and bounced.  The are still in consolidation mode.

The green count turned down just a bit, but remains above the red line.  The red line is slowly rising though.  The bulls need another thrust on the upside and soon.

QQQ started selling off right from the open while R2000 rallied to a new all time high.  We had similar action the other day.  QQQ ended up at a new low close for Sept.  That seems like an odd rotation to me.  I can't remember a time when QQQ was breaking down and small caps were making new highs.  Is it significant?   I can't be sure, but when leadership fails it is often important.  QQQ was leading earlier this year.  After every pullback it was usually the first major index back to new highs.  It has not been the same since that big sell off on 6/9.  While it has not broken any real important support levels yet there is the possibility it will start leading the broad market lower.  It is important to keep an eye on things to see what develops.  With SPX closing back below 2500 the bulls need to show up tomorrow.  A close below 2490 could bring out more sellers.

An interesting read from a money manager.  4-Warnings For The Bull Market


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