Stock Market Summary Wednesday July 25th 2012

Posted by Stephen Sutherland on Wed, Jul 25, 2012 @ 10:48 AM
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Yesterday's market action was negative.

The Nasdaq Composite fell for a third straight day falling a further 0.94%, taking it back below its all important 50 day moving average (Point A).

What made matters worse is volume came in around the average level indicating institutional selling (Point B). When institutional investors sell, it makes the market weaker and more prone to further falls.

Leading stocks action was neutral.

Today the indexes are likely to lose more of their value after tech giant Apple disappointed investors by missing earnings and sales expectations. With Apple commanding such a huge market cap ($561.90 Bil), it is sure to have a negative impact in today's session. After yesterday's behavior, and today's expected behavior, it tells me that this correction may last longer than first anticipated.

My short-term stance has switched to bearish. There is now a greater chance that the market may retest the lows it made on the 4th June (Point C). Even though we are going lower, I still view this correction as a healthy bull market correction however it looks like we have a touch of short-term turbulence ahead.

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Topics: Stock Market Summary