More European bank worries hurt stocks as Obama’s new stimulus plan fails to spark buying
The market acted like it was coming off a long weekend as volume ran lower as stocks fell. After last week’s advance it is not a surprise the market pulled back, but in a surprise move it pulled back in light trade. The New York Stock Exchange saw volume slide 12% while the NASDAQ, thanks to ORCL’s massive trading volume ended higher by 2%. If it weren’t for ORCL’s massive volume as a whole would have been much lower on the NASDAQ. A positive sign from today was the market avoided heavy volume distribution initiated by institutions.
It is easy to flag today as a distribution day as the NASDAQ fell 1.11% in higher trade, but looking closely you can see ORCL accounted for the rise in volume. On days like today it is very important to take a look at the leading stocks and evaluate their price and volume movement. Today was another positive day for leading stocks with many acting well and those who traded lower did so, on lower volume. Great action so far following up last week’s run up.
Obama’s new stimulus plan failed to spark any interest from traders to push the market higher. Today, the market needed to pull back as we did have huge gains last week. The excuse today was more European bank concerns that have yet to go away. At some point they will, but for now they are here to say. Until then, we’ll get news every so often about the concerns of the European banks and their likelihood of failing.
Obviously if the selling continues and accelerates it will not be a good sign, but more importantly will be if leaders begin to roll-over in heavier trade. Right now, it does not appear this market will falter much further, nor will we see heavy volume selling soon. With the NASDAQ just above its 50dma, a big volume bounce would solidify this rally. We’ll continue to look for accumulation in the major market indexes as well as in the leading stocks.
Remember to cut your losses short!
One New Long Position For Tonight.
Disclosure: Long: JKS RDCM ISLN NSU AMRN RDWR