Market Monitor

  • After a gap lower at the open, things only got worse. But at the end of the day there were only 139 stocks down 4% or more.
  • Putting the current correction in perspective is important, this correction is coming after 4 months of rally and after some indexes made new high. So this is normal and expected.
  • Sentiments are getting in to negative territory plus there is enough capital on the sidelines, so expect a sustainable bounce in few days. The market is unlikely to turn down without a fight. Plus leading stocks continue to hold up well. None of the major rally leaders have been dented by this correction so far.
  • If we see another 200 plus down day then one would be worried. Till then this is normal correction in the market.
  • The McClellan Summation Index is reaching levels where bounce is a strong possibility in few days.

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