- In Trade Chatter
- Last Updated: 15 November 2012
- By LA Little
I will be in Las Vegas today for a few days for the MoneyShow at Caesar's Palace. Given a talk on neoclassical methodology and great trades late Friday; an interview; and a book signing the next morning. If you happen to be there, stop in. Maybe an escape to Sin City is what one needs in the middle of a market melt. The market has shown no inclination to do what it should do and that was to bounce. I said that yesterday and repeat today for good measure. If the market doesn't do what it is suppose to do then one has to assume that it is either much stronger or weaker than you think. In this case it is weaker.
It's a buyers strike right now. Volume are not increasing significantly as price depreciates. Most tests of anchored support zones and breaks are not on increased volume levels. Just like when the market moves up on suspect volume, it can do so on the way down too - its just a more rare situation as usually it increases. What it suggests is that many are unwilling to sell but are not willing to buy either. Thus, for the shares being offered there just aren't enough bids at these price levels.
This morning futures are flat which is actually a good thing as every other day the futures have been higher and are simply an opportunity to sell. When they are flat or lower, then you can see where traders/investors heads are. Do they want to sell at lower prices coming into the morning and after a nights sleep? That's a slightly different decision than selling on momentum selling the day before.
The only positive I saw yesterday was that Apple was divergent. It is down 25% off the highs already. The markets are down 9-14% depending on what you are looking at. Apple is the most important stock out there still even with this reduction in market cap. This market simply will not rise until Apple stops falling so if you are looking for a ray of light - that's the only one I see.