Yesterday was a massive distribution day for the NASDAQ Composite.  Decliners led advancing issues by a 7.78 to 1 margin on heavier volume to wipe out the Fed induced rally on Wednesday.

Wednesday’s rally was suspect because of lack of volume, which often indicates a short covering rally rather than sustainable buying.  With Wednesday’s large white candle, volume should have been higher if it were more than a short covering rally.  Look at the last five volume bars and you will see how volume on the down days is heavier than volume on the up days.  Over the past 15 days, volume on the down days is generally higher than volume on the up days.  To me, this indicates distribution. Read Full Report