Sector Investing

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Market Breadth Charts:








These charts show that we have indeed seen some all time lows in certain market breath readings including a reading of only 3 new highs on the NASDAQ today and only 1 new high on the NYSE recently. What they don't tell you is that it is not always enough to set new lows in market breadth to induce a lasting rally. That often times does not happen until positive divergences occur at even lower lows. In other words the market could go lower still but even as it does the NYSE will likely have more than 1 new high when it hits bottom. The NASDAQ will likely have more than 3 new highs at the real bottom as well.

The top for this market was not that long ago.

So while this could prove to be a 1998 like market rallying on to even higher highs from here I think it will be more like 2000 to 2002. Hopefully it won't take another 17 months to find bottom but I don't think this bottom is the bottom.

RtS