Quick Update for Tuesday

* Indicator Update: Despite Monday's sharp drop at the end of the day, we saw fewer stocks make new lows than last week. Specifically, we had 280 new 20-day highs and 1738 new lows. New 20-day lows had exceeded 2700 early last week. Among NYSE common stocks, we had 21 new 52-week highs and 169 new lows, also not as weak as last week. Within my basket of 40 stocks across the eight S&P sectors, we have 4 stocks qualifying as technically strong, 2 as neutral, and 34 as weak--quite an extreme reading. The Technical Strength Index was a very weak -2160--a level that has been typical of short-term bottoms in the recent past. We have only 20% of SPX stocks trading above their 50-day MA and 33% trading above their 200-day MA. The latter is not yet at the level of recent bear market lows.

* Musings: One wonders, on the heels of the well-timed Abu Dhabi investment in C, if sovereign wealth funds and other overseas money will increasingly perform the role of the Fed in supporting troubled markets. One also wonders about the price of such cooperation and the equal potentials for economic harm when so much wealth is concentrated. From the market's side, as I noted earlier, sharp rallies have led to immediate selling of late, which has kept us in a downtrend. The measure of the current market will be to see if buying can engender further buying in a desire to pick up longer-term value. Until that happens, it's premature to call a bottom, despite very oversold readings and some divergences in the indicators.