A divergence today in the Industrial and the transport is very discouraging. The Transport was on a continuous decline thorough out the day and ended the day 56 points (1.5%) lower. This is after Buffett announced an all out bet on America by buying up Burlington Northern Santa Fe (BNI). The Industrial stocks opened strong and reached 9,900 then selling came in just one hour prior to the close bringing the index down more than 100 points from the peak.
This poor daily action confirmed my belief that the market is trying to tell us something. I remember seeing similar pattern during the 2008 and early 2009 sell-off. I am not suggest an all-out selling but simply be acknowledge this pattern. Below are today's movement for both averages.
Stay light on your feet. If Buffett net worth declined 75%, he's still a millionaire. If my net worth declined 75%, I'm toasted. I assumed most of you aren't in the Buffett camp and thus you should protect your investment now not try to grow it.
Art
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