Markets lost ground for a second straight session Wednesday and volume rose. Benchmarks are beginning to feel heavy and heading into Thursday both the Nasdaq and S&P 500 are lower when traditionally they fare well in holiday shortened weeks. The Nasdaq is lower by .4% for the week and has now dropped 6 of the last 8 sessions with 5 of them finishing right at their intraday lows, a bearish sign. The S&P 500 is lower by .1% for the week and is swimming below its 50 day SMA. It has the look of an unorthodox head and shoulders pattern with the right clavicle a bit higher than the left. One gets the feeling that the January Barometer, not be be confused with the January Effect, may be telling. The S&P 500 fell 3.1% in January and what the barometer tells us is that action in the first month of the year could predict how the major averages will act the rest of the year. We did see some more softening in the transport and packaging sectors today which are vital groups to the economy. RKT, which is merging with MWV, cut guidance for Q2 today and is now off a quick 11% from recent all time highs. UTIW lost 19% today after an earnings miss and this transport is now trading in the single digits. Wednesdays reaction was almost the opposite from its last release on 12/3 which rose 20.3%, and it jumped 16.1% on 9/4/14. Todays report was a bit “misguided”, pun intended.

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