Markets fell Thursday and you can use any excuse you want, be it geopolitical, or the earnings misses over night from the likes of SNDK or YUM. Pick your poison, this market is overdue for a prudent pullback. How long and deep will it be? No one knows and only a charlatan will say with certainty. We spoke of the concerning volatility yesterday and today brought a healthy dose of it. Once again the Nasdaq took the deepest bruising falling 1.4%, and the way the market went out into the close, down hard, are hallmark bearish characteristics. For the week now going into Friday the index is lower by 1.3%. The S&P 500 by contrast is down .5% for the week. Yesterday we also brought up the impotence of the housing group, and we could point out sectors that are showing red flags. The retail group was weakening even before today. KORS is lower by almost 20% from recent all time highs made at the round par figure back in February. Notice from 2/25-2/28 the stock traded above the 100 number intraday but was unable to CLOSE above it. If you want to say that is luxury retail, fine but take a peak at ROST now 24% off its recent 52 week high. PVH must be dressing the bears as well as it is lower by 20% from highs made back in the first week of 2014. I wonder if the bear outfits with have to be altered by the tailors depending just how fat they will become in the near term. Best of breed play FL has been down 8 of the last 9 sessions and looked great with a big burst above the 50 handle on 6/27 with volume. Remember that retail plays a 2/3rd’s part in GDP. Still want to blame the negative GDP number on the freezing weather?
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