One of the Weaker

stocks on a relative basis yesterday was Google Inc (GOOG). That is not a good sign for the rest of the market. When the institutions go to their best stocks to raise cash it shows a need to liquidate. That need for liquidity could be based on anything, I still think we will be hearing some “news” to explain the overall weakness. Maybe there is another big hedge fund in trouble? Something doesn’t seem right…actually a lot doesn’t seem right if you are a bull. It’s nice to be a trader and just take advantage of the emotional moves. I would not be surprised to see GOOG make a lower low very near term, maybe even today. A 50% retrace of the August low to the recent high lines up almost perfectly with the rising 50 DMA near 615, but I would not suggest buying there if looking to enter. That is an area to watch for potential support and then switch to shorter term timeframes for evidence that buyers are gaining control. One thing to look for on the hourly chart is a MACD divergence to setup, as they ogen lead to reversals. If unfamiliar with this approach, check the “MACD Video” under Popular Posts on the right hand side of this blog. DEFENSE WINS THE GAME!