With Netflix Gapping Down More Than 50 Points In Early Trading, One Market Veteran Just Warned “They Eventually Pull The Exit Trigger And The Market Collapses”
KingWorldNews.com
July 17, 2018
With Netflix gapping down more than 50 points in early trading, one market veteran just warned, “They eventually pull the exit trigger and the market collapses.”
“We Should Understand The Risks”
July 17 (King World News) – Here is a portion today’s note from legend Art Cashin: A Mere Handful Carry The Load – Over the weekend, my friend and fellow market veteran, Jim Brown, over at Option Investor, wrote about how a mere handful of powerful stocks have provided the vast majority of this year’s index gains.
Here’s a bit of what Jim wrote:
There was a lot of discussion last week about the narrow breadth on the S&P. In 2018, only five stocks supplied 91% of the gains on the S&P. The other 495 stocks were tradeoffs. Some were higher, some were lower but their net impact to the S&P was only 9% of the gain. In any market where breadth is narrow and the leadership is held by only a few stocks, there is always risk of falling. Eventually the gains in those stocks become so unbalanced, investors are forced to sell. This typically happens when the momentum stalls for 2-3 days and traders begin to worry. They eventually pull the exit trigger and the market collapses.
The Rest…HERE
