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You Certainly Can’t Call This Market a Sellout

But it is taking a breather, as the majority of stocks are in correction.

The Market

Once again we witnessed a market with no selling. Well, I should take that back. The groups that did have selling are not the favored groups.

But in reality the market has been taking a breather for several weeks now. Just look at the cumulative advance/decline line, and you can see that. I realize it’s a lot to ask, but if the market can continue to give us negative breadth numbers this week, we might set up for another “better” rally in early March – by better, I mean with better breadth.

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The biggest surprise to me in Tuesday’s market wasn’t Apple (AAPL:Nasdaq), it wasn’t the semis, it wasn’t even that Nasdaq managed to get itself barely back to green. It was that Walmart (WMT) - Get Free Report -- a stock I have liked recently -- missed earnings, had a relatively poor Christmas season and still the stock was green. It also managed to cross that downtrend line.

It has some resistance it is into now, but if it dipped back toward $118 to retest that line, I’d like it again.

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What I absolutely did not like was the action in the banks. The Bank Index, which I have had high hopes for, could be making a head-and-shoulders top and that bothers me.

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In sum, Tuesday did nothing to change any of the indicators.

New Ideas

My patience is wearing thin on CrowdStrike (CRWD:Nasdaq) as it has not yet broken out of this base. Yet I continue to believe it will do so.

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Today’s Indicator

The McClellan Summation Index has sat out the entire rally in the last two weeks. It hasn’t turned back down, but it hasn’t participated either. That is telling us the majority of stocks are not participating, they are in a correction.

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Q&A/Reader’s Feedback

Helene welcomes your questions about Top Stocks and her charting strategy and techniques. Please send an email directly to Helene with your questions. However, please remember that TheStreet.com Top Stocks is not intended to provide personalized investment advice. Email Helene here.

Is that an island bottom in Twitter (TWTR) - Get Free Report? Even if it is it still only measures to around $40. There is a lot of resistance up there and that spike high from earnings, so it might be a tough slog to get much more out of it. But it hasn’t done anything wrong since I warmed up to it a few months ago.

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I typically would not even look at a sub-one dollar chart, but I thought this one is instructive. Correvio (CORV:Nasdaq) has gapped down, not once, but twice, since December. And it has that spike low near 20 cents. If it were to become a decent chart, and I don’t think we’re anywhere close to that, it would need to do an awful lot of work under 40 cents before I no longer imagine it might just go to zero. The company is slated to report earnings early next month.

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Glu Mobile (GLUU:Nasdaq) has my interest only because it is doing an admirable job of eating through resistance, so if it can get through $8, it would eventually measure back to that old high in the $11-$12 area.

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