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.
To view the funds I hold in my ISA portfolio click here
Please note past performance should not be used as a guide to future performance, which is not guaranteed. Investing in the Funds should be considered a long-term investment. The value of the investment can go down as well as up and there is no guarantee that you will get back the amount you originally invested.
ISACO was established in 2001 by brothers Stephen and Paul Sutherland and is the first financially regulated firm to offer adventurous ISA and SIPP investors a unique personal investment service that shares on a daily basis our star-performing investor’s thoughts, personal insights and investment decisions.
Clients enjoy being informed throughout the year what ‘best of breed’ funds our premier investor currently owns, when he’s buying and when he’s moving into the safe harbour of cash – helping clients enjoy more control, manage their portfolio more effectively and benefit from the potential of outstanding long-term returns.
For more information about ISACO and our Investment Guidance Service, please read our free brochure.
If you have any questions or thoughts on the points covered in this post, please leave a comment below or connect with us @ISACO_ on Twitter.