{"id":4902,"date":"2011-09-30T07:23:56","date_gmt":"2011-09-30T12:23:56","guid":{"rendered":"http:\/\/leavittbrothers.com\/blog\/?p=4902"},"modified":"2011-09-30T07:23:56","modified_gmt":"2011-09-30T12:23:56","slug":"before-the-open-sep-30-3","status":"publish","type":"post","link":"https:\/\/blog.leavittbrothers.com\/?p=4902","title":{"rendered":"Before the Open (Sep 30)"},"content":{"rendered":"

Good morning. Happy Friday.<\/span>
\nThe Asian\/Pacific markets closed mixed. Hong Kong lost 2.3% and India 1.5% while New Zealand gained 1.3%. Europe is currently down across the board. Other than Norway, every market is down at least 1%. Futures here in the States point towards a relatively big gap down open for the cash market which will mostly wipe out yesterday’s late-day rally.<\/span>
\nOn Monday I stated the following: It seems like many are looking for prices to hold and then the selling to resume next week. When many look for the same thing, that same thing doesn’t often play out. I would not be surprised to see a gentle move up for a couple days and then the selling to begin again Thursday or Friday…a little experience tells me some bigger traders will jump the gun and sell a little early rather than wait for next week.<\/em><\/span>
\nThis scenario played out pretty darn well. The market was strong early in the week and weak the last couple days. Big funds that need to unload positions do it when they can, not when they’re forced to. That means taking advantage of the opportunity to sell when everyone agrees the market will stay propped up until the end of the week. <\/span>
\nThe indexes are still range bound but a new development has gotten my attention this week: the under-performance of many leadership stocks. AAPL, AMZN, BIDU, PCLN, WYNN just to name a few. On a long term basis, these stocks remain in steady uptrends, but short term they’ve started to lag. Twice this week AMZN has gapped up and gotten hit hard with selling pressure. Yesterday it lost more than 3% while the indexes move up. Can the market rally if many of the leadership stocks lag so much? Probably not…unless a new batch of leadership stocks step up, but math doesn’t work out right now unless the Nas changes the weighting of these stocks in their two indexes. You get the point. The leaders need to lead because other stocks will blindly follow along but also because the leaders are over-weighted in the indexes. If the over-weighted stocks drop, it’s almost mathematically impossible for the indexes to move up. <\/span>
\nThe trend remains down. Don’t make this more complicated than it is. <\/span>
\nheadlines at Yahoo Finance<\/a><\/span>
\ntoday’s upgrades\/downgrades<\/a><\/span>
\nthis week’s Earnings<\/a><\/span>
\nthis week’s Economic Numbers<\/a><\/span>
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