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Tuesday, October 21, 2008

Last Hour Sell Off

The positive today was low volume. The negative was big selling in the last hour, and finishing near the low of the day. The major culprit seems to be crappy earnings from JAVA, TXN, and CAT.

The Nasdaq 100 got hit pretty hard. YHOO announced they are getting rid of 1500 jobs. Even good news from AAPL did not help. Technology has been the laggard sector for the last couple of days, which is not conducive to a decent rally.

The Russell 2000 made it's smallest move in almost 2 weeks. That in itself is ecouraging, as it might indicate that the sense of panic pervading the market is dissipating. Not undercutting yesterday's low is also encouraging, as is the imminent MACD crossover here and on the SPX.

The VIX also indicates dissipating fear as it did not rise substantially during the last hour selloff. Note here that MACD has crossed over and momentum has shifted downward.

For the last 13 weeks, the best performing industry has been the airlines. This hit bottom when oil topped, but has had trouble with the 200dma, and is now right up against it. MACD is showing pretty strong upside momentum, and RSI isn't anywhere near overbought, so this could move up as long as oil doesn't.

On the earnings front, tomorrow CLB and AXYS are confirmed to report, ARCI unconfirmed.

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