The Lead-Lag Report: Resistance Everywhere
As markets wait for the outcome of US presidential elections and the coming Greece austerity vote, internals hit all kinds of resistance and support levels. Clarity to come, or further confusion? We'll find out soon enough.
Consumer Staples (XLP) – Punishing Defensiveness
Comments: Consumer staples appear to be rolling over as concerns grow over the fiscal cliff and taxing of dividends under an Obama administration, similar to utilities. More time is needed to see if this is noise, or the start of a trend.
Energy (XLE) – Broken Energy
Comments: Energy appears to be in the early stages of a real breakdown, unable to break past prior ratio highs. More time is needed to confirm, but those wanting to bet against the market might want to consider the role of energy as a laggard in the coming weeks.
Markets are, across the board, hitting resistance internally as uncertainty over the elections in the US and Greece dominate decision making. The corrective period remains with some mixed messages. More time is needed to get a clearer sense, but caution remains warranted.
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