Tuesday, January 12, 2010

NQ Retracing All of 2010 Gains

On the heels of failing to facilitate trade higher (see previous post), we've now seen volume enter the trade to the downside. That has given us a range extension below Friday's lows in the major averages. Given how we rejected those Friday lows following the unemployment release, this represents fresh selling pressure and takes us out of a short-term uptrend. It also represents an expansion of volatility that will be worth tracking going forward.

Meanwhile, note that the NASDAQ 100 (NQ) futures (above) have retraced all of their 2010 gains--and then some. We're not far off 2010 lows in the Russell 2000 Index as well. Along with the non-confirmations noted in the earlier post, this inability of the more growth-oriented, speculative indexes to sustain highs offers a note of caution to bulls.