Mid-Week Market Overview for June 20

Jun 20, 2007: 4:05 PM CST

Today did some technical damage to the major indexes, with the Dow being spared breaking its 20 period moving average, as the other indexes have done.

We are seeing possible unwinding of developing momentum divergences in many of the indexes (especially the Dow). We also see price rejection in the indexes as well as we retest new highs and set-up failure patterns that are wrecking many stocks at the late stages.

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The Nasdaq was the only of the four major indexes to make new price highs, yet today’s action unequivocally rejected the new highs, leading to established overhead resistance that must be overcome by fresh buying pressure soon (if it occurs).

Nothing was spared today in the sector view, although the good news was that high-flying Energy was hit the hardest (3%).

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I won’t post the industry chart, but everything was red except for two industries: Retail (+0.52%) and Airlines (+1.42%).

The Utilities industry (-2.54%) was hit the hardest with Oil (2.48%) not far behind. In terms of sector rotation theory, this is usually good news for the overall market.

Of special note, agricultural prices, especially corn, were hit hard today, with aggregate losses exceeding 3% in one day. Recall that Corn has been on a strong euphoric bull-run and sudden down days are not uncommon.

The market took a hit and may be wobbling tomorrow. Be safe.

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