7/2T11:02 Market Comment

Market Comment: 1st Accumulation day...

Beware! The markets are still in a down trend but yesterday was a major volume reversal day that resulted in the 1st accumulation day since this sell off started in the middle of May. I'm not calling the for the bottom, but I will say that in order for a bottom to develop accumulation days need to appear and this is day 1. I still expect lower prices but will watch closely to see if they come with lower momentum as well or does a positive divergence begin to develop.

The reasons don't really matter to a technician, but the market reversed yesterday on the back of two dubious stories. One, the ISM number was stronger than expected and we don't believe any of these gov't numbers. And two, GM stated that their losses were a little better than the street expected. these are the type of stories that can get shorts to cover but they are really nothing new that would change the picture.