Wednesday’s “bully” celebrated gap up soon turned into an orderly capitulation-like selloff across the indices. Although overall volume did get a boost (+7%), HG was rather calm and COOL at zero, virtually a stalemate for both sides… So what appeared to some folks to be a state of surrender, was really just a day of consolidation. Whether the panic selling is just around the corner or the big boys are re-positioning themselves for a big move higher remains to be seen. What we can see is that the Nasdaq, our faithful leader, has not yet logged any more distribution days since the market reversal on 4/5. The bears will glad to hear, however, that there haven’t been any accumulation days either, so while the calculated long trade (i.e., “buy the dip”) is still in play, there’s only so far one can go when you’re low on gas. -MD
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