This is the first day that the bubble names actually went down with the market in a while

 

Catching up

QQQ has been correcting since mid October (or really September): double top

Someone was buying ZM at $550 this morning. It quickly reversed its gains and went negative with the rest of the market (ignoring GE and its earnings result), really the first time it actually responded to what has been a steady decline since mid month (as summarised by the chart of QQQ above).  I mention this because for the first time in really two weeks the bubble names finally stopped floating about in their own bubble and moved with the rest of the market–down. Before then, the most resilient names were oddly the most overvalued. But today names like ZM, SHOP, TSLA and so forth actually went down instead of up along with the rest of the market. It always seems that things take two weeks before they sink in or something.

In any event, if this holds up it would mark a transition phase in the trend change as even the most overvalued names trend downward with the rest of the market.

ZM seems to really encapsulate the state of the market with a price/sales ratio of 115. Monday and Tuesday’s price action was very odd because while the market was correcting, these bubble names were flat or going up. The fact that ZM finally dropped materially, over -4% on the day, means that whatever excess liquidity was pumping these names up irrespective of facts could finally be drying up (as would be expected when essentially every name on the board was negative). As the general market continues to correct we may finally see ZM actually fall. As mystified as I am with a failing name like TSLA, ZM is even more astounding as there simply is no moat or anything even special about video over the internet given that literally every tech firm does it.