Chart Of The Day: Nasdaq Comp.
Say it with me - Fresh breakouts AFTER a market has been running have a higher degree of failure. One look at the NASDAQ Comp. here and you can clearly see this.
So now what? For that let's talk Fibonacci retracements. As you can see we are fast approaching the 38.2% Fib zone which also just happens to be the 50 day average. If that doesn't stick? Then there is the 50% and 61.8%. Remember, Fibonacci retracements can and often do act as support zones. At this point it's just a matter of which one is going to call the ball and truly act as support. If none of the most common Fib zones stick then the big green uptrend line could be in play.
You can also see that when one looks at the RSI above the chart and the Full Stohcastics below the chart they aren't quite to the oversold territory as of yet which means that we still could have a bit more downside before all said and done.
So what does one do? Sit back and watch for stabilization while having a list of names so that when a turn around shows up you are ready in advance vs having to chase them AFTER they really start to move. Just look at all the past selloffs in the chart above and see what ultimately they all led to, just an observation folks.
Makes one wonder if this isn't a setting up the pins so as to bowl for strikes for a Santa rally into the holiday.
Take care, have a great rest of the week.
Disclosure: None.
Disclaimer: THESE ARE NOT BUY RECOMMENDATIONS! Comments contained in the body of this ...
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