Despite what looked like modest action today in the overall indices the internals of the market were quite ugly.  This ugliness was expected and needed but nonetheless still painful.

The awaited pullback finally hit and the selling was quite intense.  Breadth was over 2 to 1 negative and only the drugs and health care finished in the green today, which indicates many participants were simply running for cover.

This poor action will definitely help boost market skepticism and surely shook out many weak holders today. The consolidation is healthy as we had run too far too fast, with many speculators needing to temper their confidence.

Despite raising some cash, and holding some shorts, Shark HQ took some hits today in our small cap holdings which were particularly weak; however, this action actually raises our confidence of a bullish market going forward. The sharp pullbacks as the short term momentum traders dump first and ask questions later will help give us some good entry levels. Despite the bids disappearing and these stocks falling into the abyss, the numbers reported only weeks ago have not changed and will only make these stocks look much more inviting once overbought conditions are alleviated.

My young apprentice has been on the road investigating new opportunities and will return to relay some new ideas to you just in time for Thanksgiving.  We suspect some very good trading opportunities will develop as we approach Turkey day. Regardless of the desire to focus on the stuffing and gravy, we suspect their may be much excitement over the next couple weeks and it will be much better than Aunt Hilda’s fruit salad.

For now we hold strong and be patient as those less confident than us pack it in and call it a day.

Have a good evening

RevShark