A Record Bear Market Pecentage Drop

DJIA - 444.99, -5.56% SP500 - 54.14, -6.71% NASDAQ Comp. - 70.30, -5.07% Russell 2000 - 27.07, -6.56% Exchange NYSE NASD Advancing 334 426 Declining 3,414 2,526 Oil $48.70 -$4.92 Gold $748.70 +$12.70 SOX 171.32 -5.78 VIX 80.86 +6.60 Strongest Sectors: XLI -2.68%...XLV -2.85%...XLP -3.48% Weakest Sectors: XLE -12.37%...XLF -10.74%...XLY -5.86% Sector Watch Up Trending: Sideways: Down Trending: XLP, XLF, XLY, XLV, XLI, XLE, XLU, XLB, XLK Thursday was a record day setting, a new record post WWII bear market percentage drop. The prior worst bear market was the 1973-1974 bear market which fell from high to low -46.5%. As of the close today, the DJIA was down from its October 9, 2007 high -46.68%. A new bear market record. All four broad indices have broken support and are again in an intermediate term downtrend.

Decliners again led advancers by a 9 to 1 margin. All nine sectors moved lower. Stocks experienced a technical bounce in the morning that faded as concerns over the auto industry and jobless data weighed on the market as sellers gained the upper hand sending stocks lower. Stocks continue to be technically oversold in the short-term, so be alert for a potential short-term bounce Friday or Monday. This could provide a bullish move on the few leading stocks or a counter bounce on the many down trending stocks. Oil dropped $4.92 sending the Energy ETF (XLE) down over 12%. Gold rose $12.70.

Index Commentary The DJIA large black candle…new 52 week closing low…breaks below its Oct. 10 intraday low. The SPX large black candle breaks support…new 52-week intraday and closing low. The Nasdaq formed a large black candle breaks support…new 52-week intraday and closing low. The RUT formed a large black candle breaks support…new 52-week intraday and closing low.

Trend Reversal Strategy RIMM stopped out at $44.70 today. The options closed out at 2.50 with a 41 cent gain or 19% gain. We stated in our Wednesday morning webcast that it would be valid to move the stop even higher in the current volatile market to lock in the strong one day gains, but that we would follow the strategy rules for illustrative purposes.

Stocks to Watch on Friday Support Bounce AXYS Potential Support Bounce SRCL, CHRW, TEVA, SHLD, FAST, VMW, WYNN Broke Support from Wednesday Stocks to Watch GILD…JNJ…IBM…BCR…CELG At Support PCP Below Support BA formed an inverted hammer…watch for a potential counter trend bounce Leading Stocks Holding Above 30 DMA TEVA Stocks Moving Below 30 DMA AFAM…CL…DLTR…DV…MYGN…VIVO Stocks Staying Below 30 DMA ANSS…AOB…AYE…CBST…CERN…CHTT…ESI…FLIR…FSTR…GILD…GIS…MMM…PCLN…PRGO…PSSI…SHW…SWN Thursday’s Action Moving Up: None in our Watchlist Moving Down: FSLR, POT, MA, MOS, AGU, CF, BTU, X, BUCY, MON, ANR, GS, ESRX, V, LDK, SOHU, CLF, NIHD, SCHN, FWLT, CNX, NUE, PCLN, IPI, STRA, KBE, KRE, NDAQ, ZION, RF, UAUA, MEE, SINA, MS, KMT, MER, DRYS, BIDU, LAMR, INFY, ONXX, AMZN, GRMN, PNRA Intermediate Term Market Trend: Down Short Term Market Trend: Down