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Point & Go Figure: CAT, BMD, NVLS, SPX, TLT

By

Don't count me out just yet

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Market Overview:
The short-term conditions remain extended and in high-risk areas, but the percent of stocks above their 50-day moving average for the NYSE and Nasdaq both reversed back up with yesterday's action. For now, both remain well below the declining peaks that date back to the 2004 highs, indicative of deteriorating breadth and momentum. Moreover, their reversals up occur with the High-Low Index for the NYSE and the Nasdaq both declining yesterday, another short-term negative divergence.

As well, the Nasdaq-100 (NDX) Bullish Percent, officially negative after reversing down from the high-risk 70% area, moved lower yesterday, while the Bullish Percent for the Dow Industrials, also negative, remained flat. Supply remains in control of the NDX and DJIA.

Bottom line: Short-term indicators remain in high-risk territory. Intermediate indicators are negative and deteriorating, and the long-term indicators, though still positive for the NYSE and NASDAQ Composite, are in high risk areas and showing the long-term trend of diminished participation still intact.

Charts of Interest:
Caterpillar (CAT)
(Chart courtesy Dorsey Wright)

Birch Mountain Resources (BMD)
(Chart courtesy Thomson Financial)

Birch Mountain Resources (BMD)
(Chart courtesy StockCharts.com)

Novellus Systems (NVLS)
(Chart courtesy Dorsey Wright)

Novellus Systems (NVLS)
(Chart courtesy Thomson Financial)

S&P 500 (SPX)
(Chart courtesy Dorsey Wright)

iShares Lehman 20+-year Treasury Fund (TLT)
(Chart courtesy Dorsey Wright)

No positions in stocks mentioned.

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