Tuesday, December 04, 2007

Downtrends Resume

Yesterday we noted that the longer term trend in the Nasdaq sector was still up and that shorting the broader market was not a good idea. Nevertheless, buying the broader market is not a good idea here either.

Meanwhile, we are seeing downtrends in the weakest sectors showing strong signs of exhaustion after last week's bounce. Technical conditions are ripe for a continuation of the downtrends in retail, banking, transportation, and housing.

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