World markets were reacting to very poor flash PMI data out of Europe. Futures were lower, but were dealt more blows with disappointing US economic data. Jobless claims rose more than expected, but a big drop in the Philly Fed Index showed how weak this economy really is. Volume was hot throughout the day and ended higher notching a distribution day for the market. A back-to-back distribution day was not something we wanted to see from this market. While we didn’t tip into correction mode just yet we are on the verge with another day of distribution. Market leaders didn’t fare well either and something we are keeping a close eye on.
At 2:30 the market did get some relief as the NASDAQ was able to jump more than 20 points into the final hour. However, the last half hour of the trading day saw sellers regain control. The market has wiped out a few weeks’ worth of gains in two days. Everyone has been expecting a pullback, but now that we have hints of a pullback how will it play out? Price will be our guide and we’ll ignore the noise out of the media outlets.
Short-term trend models for the market using SPY, IWM, and QQQ are still in an uptrend. DBC switched to a downtrend and it isn’t a surprise after the carnage in commodities. Our short-term trend model has been all over the declines in USO, UNG, GLD, and SLV. There isn’t any guess work and zero emotions.
TICKER ST TREND TREND CHANGE DATE CLOSE %
SPY UPTREND NO CHANGE 2/21/2013 150.42 -0.61%
IWM UPTREND NO CHANGE 2/21/2013 89.95 -0.97%
QQQ UPTREND NO CHANGE 2/21/2013 66.47 -1.07%
USO DOWNTREND NO CHANGE 2/21/2013 33.43 -2.17%
UNG DOWNTREND NO CHANGE 2/21/2013 18.15 -0.93%
GLD DOWNTREND NO CHANGE 2/21/2013 152.62 0.78%
SLV DOWNTREND NO CHANGE 2/21/2013 27.73 0.51%
DBC DOWNTREND CHANGE 2/21/2013 27.60 -1.15%
FXY DOWNTREND NO CHANGE 2/21/2013 105.27 0.43%
FXE DOWNTREND NO CHANGE 2/21/2013 130.78 -0.68%
TLT DOWNTREND NO CHANGE 2/21/2013 116.27 0.58%
Have a great weekend and stick to the game plan.
