Coolhand's Market Analysis

If the smart money is trying to shake us of our expectation for a Santa Clause rally this year, they're doing a good job of it. For the record, the day before and after Thanksgiving combined has seen only 12 losses in 58 years.

Make that 13.

So the beat continued today, or should I say beat-down, as the broader market posted significant losses in its sixth straight daily decline. Volume was not as thin as might ordinarily be expected in pre-holiday trading. That may not be a good sign. Nor was the increased selling pressure in the last few minutes of trade.

Helping to stoke fears, the Fed ruled last night that top-tier domestic banks with total consolidated assets of at least $50 billion must now submit annual capital plans for review. That brings the total number of banks under surveillance to 31.

And over in Europe, Germany held a debt auction that found disappointing support. That's not a good thing when the EU's most "robust" economy is now seen as a risky play.



Our own debt auction today was quite successful by comparison.

Earlier in the trading day there were some data points released. Initial jobless claims came in at 393,000, which was in-line with estimates. Personal spending in October was up 0.1%, but that was less than the 0.3% increase economists were looking for. Personal income rose 0.4% and that was a bit higher than the 0.3% increase that had been expected.

For October, durable goods orders fell 0.7%, which was actually better than anticipated as analysts were looking for a drop of 0.9%. Less transportation, durable goods orders were up 0.7%, which easily beat estimates for a flat reading.



NAMO and NYMO now appear to be falling off a cliff and remain in sell conditions.



NAHL and NYHL look to be slowly dropping to the downside. They too are in sell conditions.



TRIN and TRINQ are finally giving readings that are more consistent with the action. Both are now on sells and suggesting a modest to moderately oversold market.



BPCOMPQ is falling off a cliff. It too remains on a sell.

So all signals are in sell conditions, which keeps the Seven Sentinels in an intermediate term sell condition.

Given today was a historically positive day for stocks and we sold off on relative volume (for a pre-holiday) instead, I can't say I'm particularly bullish for the next week. Friday will be telling if we drop yet again, and next week is not considered a strong week. Technically, the charts are now a train wreck.

There is still plenty of time for a rally into year's end, but I have to wonder from what level it may come? If this market doesn't get back on track to the upside soon, it may signal something bigger is afoot. And I have to admit, I'm getting concerned about the EU and its ability to hold together. That may be the main reason for selling pressure and why this market is back to "risk off".

I'd like to take this opportunity to wish everyone a Happy Thanksgiving and to be safe where ever you may be headed.