DOW FALLS UNDER DECEMBER LOW -- GOLD STOCKS BREAKOUT TO SEVEN-MONTH HIGH
CHART BREAKDOWN... It looks like the market is going to end the week on a downer. Near midday the Dow is down over 200 points and, more importantly, has fallen under its late-December low at 8250. If those lower prices hold through today's close, that will represent a short to intermediate-term chart breakdown. It's not just the Dow. The S&P 500 is doing the same (as is the NYSE Composite Index).
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BIGGEST DOW LOSERS... In a continuing sign of weakness in bank stocks, JP Morgan Chase is the day's biggest percentage loser in the Dow. The stock is presently slipping beneath its 50-day moving average. Other big Dow losers include American Express, Disney, Intel, and SBC.
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BIGGEST TECH LOSERS... In a weak tech sector, two of the biggest percentage losers in the Nasdaq are Broadcom and Nextel. Both are falling under their 50-day moving averages. BRCM recently falied a test of its 200-day line. The big tech stocks are weak also today. The biggest of all -- Microsoft -- is trading under its 200-day average.
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BIG UTILITY LOSERS... Several utility stocks are tumbling on heavy trading volume. The worst is CMS Energy. American Electric Power is falling on heavier volume -- after recently breaking its 50-day average. PNW is also breaking moving average support on heavy volume.
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GOLD STOCKS ONLY BRIGHT SPOT... With the stock market (and the dollar) tumbling, gold stocks remain about the only bright spot. The XAU Index is breaking out today to the highest level in seven months. We've been saying for a long time that gold stocks are the place to be when stocks and the dollar are weak. Gold futures are up another $4.00 today and are nearing $370.
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