MDM - Update 11/24/10

Published : November 24 2010 at 16:49 ET

Leading stocks continue to act well overall, and the NASDAQ Composite has moved above the 2536 level but on light preholiday trading volume. Friday is a half day but historically a mildly positive day.

The model remains on sell as this is light holiday volume rallying. Next week will show whether the model will continue to stay on a sell signal, or move to a neutral signal. Convincing volume next week by leading stocks and/or indices will most likely shift the model to neutral, and a follow through day will shift the model to a buy signal.

Note, the number of distribution days stands at 4. Should the model switch to a neutral or buy signal, a breakdown below the low of a fifth distribution day along with action from leading stocks confirming the breakdown would trigger a renewed sell signal.

The markets have recently been quite challenging. These are markets that sell off hard along with leading stocks, then bounce right back. As always, if you bought any of the stocks we recently recommended, obey your sell stops. And obey your maximum loss percentage levels on any inverse ETFs you bought. So far, the NASDAQ Composite has moved about +2.8% above where the sell signal was issued.

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