Breadth remains in a sell signal. Expected increased selling pressure when the March/April lows were broken but we've been experiencing slow drip selling since. Cash remains the safest place to be.
With an improvement in breadth over the past three days the Nasdaq Summation flipped to a buy signal. Follow through is the key…
With most mid-term breadth indicators in sell signals, the market has been struggling to keep any gains over the past week. During these periods, the best of breakouts will punish any buyers with a promising surge one day only to give it all back the next.
Until we see a breadth thrust on the Stock Bee daily breadth indicator, cash seems like the safest place. If you are bold enough to take some swing positions, chose your entries carefully and honor your stops.
Looking at breadth comparing sector to sector we can see concentrated selling in the semis over the past 10 days. Click the screenshot below for details.
Top 5 Sectors ranked by number of stocks down 4% or greater.
| SectorName | FourPercentUp | FourPercentDn | UpdateDate |
| Technology | 1 | 18 | 4/4/2012 |
| Gold | 0 | 12 | 4/4/2012 |
| Independent Oil & Gas | 1 | 10 | 4/4/2012 |
| Healthcare | 0 | 7 | 4/4/2012 |
| Basic Materials | 0 | 6 | 4/4/2012 |
$RUT - Daily Candlesticks, Landscape:
via StockCharts.com
Russell is making another attempt at highs. A close above this level would be a positive sign for the market.
KORS - Daily Candlesticks, Landscape:
We love the popping power an IPO can offer, but watch out for a Secondary Offering. Seems like everytime one of these IPOs start getting their mojo going they decide to do a Secondary taking the stock down few a few weeks. KORS announced a secondary offering of 25 million shares at 47, a 4% discount to Thursday's closing price.
$RUT - 60 min Candlesticks, Landscape:
Russell pops through February resitance. Let's see if it can hold these levels through the close.
$RUT - 60 min Candlesticks, Landscape:
via StockCharts.com
After pulling back and recharging, the Russell rallied back to the February highs. Looking at the 60 minute chart, it bounced back off those highs. The Russell has been lagging the DJI, SPX, and COMPQ since early February. Looks like we're range bound until it can break above that February resistance.
EGHT - Daily Candlesticks, Landscape:
EPS % Change from Same Qtr a year ago 33%, Sales % Change: 31%
EGHT Blasted 25% on their last earnings release. Nice consolidation period followed by a move above 4.65 will take this stock higher.
CPHD - Daily Candlesticks, Landscape:
EPS % Change from Same Qtr a year ago 56%, Sales % Change: 36%
CPHD landed in the post earnings list after being up 26% on their most recent earnings. I would like to see some more buying at this level to verify they've found support. CPHD is one to watch when the market turns back up.
$RUT - Daily Candlesticks, Landscape:
Last week, we saw some weakness in the breadth indicators. Now we're seeing follow through on the indexes. Nothing to do except sit and wait in cash while the market figures out what it wants to do next.
LNKD - Daily Candlesticks, Landscape:
EPS % Change from Same Qtr a year ago 140%, Sales % Change: 105%.
LNKD is from the IPO list in Bluefin. After the intial earnings thrust, LNKD has pulled back offering a lower risk entry. They are a recent IPO in a sector receiving quite a bit of attention, watch for a move above $88.00 for entry.
