Markets continue to flash bearish signals as the second consecutive day stocks weakened into the close. The Nasdaq led the way higher by .45% and the S&P 500 was UNCH. As they say, it is not how you start but how you finish, and many technicians feel the closing price is extremely important. Markets were higher early on the backs of a better than expected 4% GDP number. Many economically sensitive stocks seem to be saying that number may be bloated. When I look at the technical damage that has been done to names such as CBI down 32% from its most recent 52 week high, or a JEC 22% from its own high it makes you wonder how strong growth really is. PCP slumped 9.5% last week after reporting earnings, slicing its 50 and 200 day SMAs in the process. Weekly volume was the heaviest since the week ending 10/7/11. The consumer does make up 2/3rds of GDP with their spending habits and overall the group has been very poor, but if you look at some best of breed names like a UA which gained almost 15% after reporting earnings on 7/24 maybe you can make the case that growth is resuming. CRI reported that session as well and rose almost 8%. SKX reported last week as well and jumped 8% on 7/24 as well. Even DECK rose more than 6% on 7/25 after releasing numbers. So we can debate all day whether the market is going to continue higher, or start its long overdue summer slowdown. Just pay attention to the tape in your own specific situations and trade accordingly.
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