A Most Difficult Week

Stocks got slammed this week as credit-related concerns dominated trading and headlines. Essentially there is a credit crunch of sorts taking place that is causing players difficulty in getting deals done and raising concerns about future deal flow. Since the stock rally was a funciton of the takeover game this is cause for concern.

Although most every stock I follow was up in the last hour of trading Thursday, there was no short covering rally that extended into today. In fact it was a dismal affair today with the major averages again on their lows. In some ways it was similar to the selloff in late February - ferocious, global, and widespread. New lows swamped highs as well as declines over advances. The technical damage looks as bad now as it did then. My thoughts had been that this selloff would not go as far as it did so naturally one tends to hold back from additional bold statements. However, unless the world is coming to an end the selling will abate and the market will catch a bid. It could be at the 200 day XMA which would be logical but the market is not always so cooperative.

For now, the market is closed and life continues. We'll worry about the rest first thing Monday (and probably a little over the weekend).