Reply #1: WrapUp by Martin Goldberg

[ozymandius]

THE U.S. STOCK MARKET LOOKS TIRED
(Gold Stock Review Below)

The stock market is in the traditionally bullish year end period in a year where seasonality is one of the most followed aspects of the market. Therefore, it would be caviler to take any significant bearish positions against such herd behavior. Still it is not difficult to find a few cracks that are beginning to build in the US stock market. Among stocks and sectors showing weakness are transportation stocks, the Nasdaq 100, Google, the US homebuilders, and certain formerly hot “concept” restaurants.

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Nasdaq 100 – Looks Tired

After leading the US stock market higher through most of the election year-end rally, the Nasdaq 100 now looks tired. While the Dow and S&P 500 averages have made all time and new multi-year highs respectively, the Nasdaq 100 has been locked in a trading range over the last 5 weeks. The lower pane of the weekly chart below shows the performance of the Nasdaq 100 divided by the S&P 500. When the line moves down, the Nasdaq 100 is underperforming the S&P 500 and this is what is happening now. Over the last 3-years, decisive trendline breaks of this chart, as has occurred about 3 weeks ago, have produced reliable sell and buy signals for the Nasdaq 100.

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Google – Looks Tired

The watched phenomenon, Google, perhaps reflects the tiredness of the Nasdaq 100. While GOOG has advanced to levels where it is sure to be part of the documented history of this bull market, it is important to note that each of its advances have come on diminishing volume. Whereas the previous advance to above 450 has come on weekly volumes of about 50 million shares, the rally to 500 occurred on about one-half of that amount. Is there anyone left to buy Google?

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