(But we're not superstitious, are we?)

We had a big down day on April 30.

Back then, I had been looking for a one- or two-day whack because the market was heading toward an oversold condition.

That is what's different this time: The market is not oversold.

It might look that way on the chart, but given the way the numbers line up, the market won't be oversold for at least another week or more.

For the past few weeks, I've been repeatedly noting the narrowness of the market's rise. It is evident in the oscillator above. I have also discussed the McClellan Summation index, as it had become stagnant. Have a look at the chart today. It has now rolled over from the second lower high.

Each subsequent lower high means that many fewer stocks have been participating. So by the time it gets to the second lower high, we've lost an awful lot of stocks on the upside. This indicator started showing lower highs in January 2006, and we didn't have a major correction until May 2006. For this particular rally, it peaked in December 2006, so you can see that a narrowing market eventually takes its toll. The peak reading for the number of stocks making new highs on the New York Stock Exchange was 545, reached in December.

That means that the majority of stocks peaked five months ago. Instead of showing you yet again the raw data for new highs, let's look at the 10-day moving average of new highs minus new lows. This also has a second lower high.

It has been a while since I showed the chart of the put/call ratio, even though I discuss it regularly. The 10-day moving average of this indicator is back at the bottom of the page, where we normally would find the market head lower.

Before you scoff and note that it got this low last fall and stayed there, let me make a few other observations. Last fall, we didn't have a series of lower highs in the new highs and new lows and in the McClellan Summation index. The members' short ratio was also not at 43% last fall, though it was at that level last May 1.

Finally, let's revisit the chart of the Nasdaq relative to the S&P 500. It is back at 1.7. I believe if it breaks this level, it is important. Even if the S&P 500 outperforms the Nasdaq on the downside, it still means downside.

Besides, did you notice that the only excuse anyone could find for yesterday's decline was profit-taking? They couldn't blame it on subprime, the Chinese market or the Fed. They tried to blame it on the retailers, but that group actually held up rather well, all things considered! I'm sure we'll know soon enough the reason why everyone was so keen to take profits. After all, the reason usually comes out after the decline, not before.

It's just another version of "buy the rumor, and sell the news."

	What do you think was behind yesterday's "profit-taking"? Answer Here