Markets fell hard Tuesday, (what a day to come back from my vacation!) and as much as I hate to agree with the pundits, many are right for not blaming the Syrian situation. This market was ripe for a pullback, and warning signs were flashed well before Syria. The housing stocks imploding is old news, but the transports recent demise, is putting the nail in the coffin of another former leading group. Durable goods took a dive, emerging markets have been slumping. We recently noted concern about best of breed retailers sporting warning signs like GPS M HD, and now the first two are already in correction mode, while HD is knocking on the door down 9% from its recent 52 week high. TGT WMT are now below their respective 200 day SMAs, and lets remember that GDP is comprised 2/3rds by consumer spending. The Nasdaq received the brunt of blow today, down 2.2%, and that is concerning, since it has been the strongest index of the big three by far this year. Coming into the week it was up 21.1% YTD, compared to the S&P 500’s 16.6%, and the Dow’s 14.5% advances. It came very close to testing its 50 day SMA, which lies at 3561. The S&P 500 obviously is below its 50 day SMA, and a logical spot to expect a bounce would be at the round 1600 figure. Talking about round figures, looking at the Nasdaq 3300 was support on 6/24. Resistance came in late March at 3500, mid to late July 3600, and 3700 on 8/5.
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