Markets lost ground this week to the tune of 1.5% for the Nasdaq, and 1.7% for the S&P 500. The S&P 500 seemingly had altitude sickness above the round 1800 level and its daily chart is sporting a bearish rising wedge pattern. It has now lost ground 9 of the past 11 days and many of those down days came on accelerated trade. It is nearing a 50 day test about 1% lower from here. The Nasdaq looks technically better, and still commands an 8% point gain above the S&P 500 up 34.5% YTD, as it holds the round 4000 handle. This weeks 1.5% loss comes on the backs of two separate railroad track patterns the weeks ending 11/15-11/22 and 11/29-12/6. We did mention the fact that solid breakouts have been scarce and the benchmarks path to least resistance does feel lower. Indexes this week ignored some decent economic data, and when markets do not respond well to benign developments that often is a tell. Decent employment figures, rosy retail sales figures, have all led to fears over the dirty tapering word. For those who believe the tapering is baked into the cake, they may be misaligned. But the train is still humming along, although this week it did need a rest stop and maybe an oil change and tune up, and it will be interesting to see if additional repairs are needed and how the market responds going into year end which is traditionally a strong period. Strong GDP growth of 3.6% in Q3, has me a bit skeptical. News this week that rents have dropped for a third consecutive month in New York City is one reason. Lets see where the markets reside next week, pun intended.
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