Home later than I wanted to be. Had to pick up car from the service station. 30k mile service for the car, costs a few bucks!
In almost a drive by shooting, the markets have gone from flying higher all of October to suffering bad damage over the past two weeks. The easiest way to see this is to go to the charts.
Daily for SPY:
You may recall back at the start of October I traded in and out of both CVLT and NI. I cloned those positions in my long term account and here is how they are looking now (both closed out).
Things are very oversold now and a bounce higher is probably going to happen. I look over the big picture and I don't like what I am seeing.
Between the MF Global fraud, accounting issues at GMCR, and today's Chinese burrito news on FMCN there seems to be too much bullshit out there to be comfortable. I have been a proponent of the idea for run higher to year's end. I am backing off on that now. If the Euro weenies get their act together and Bernanke unveils some kind of new pony, maybe I would change my mind. At this point after the damage lately I think performance chasers may just start licking wounds and manage funds, not run blindly after a rally that has fizzled out.
The big problem is that charts are so damaged it will take time for them to set up. It's November 21st now which does not leave a ton of time. Any fast improvement will be suspect I believe. The way well supported moves up are being abandoned feels more dangerous to me than a vanilla correction. Just my 2 cents. Things probably go vertical from here on out the way this autumn has been.
Have a good night.