Stocks tanked after S&P Rating Services lowered Greek's debt to junk and cut Portugal's rating. This sent European stock market's plunging to their worst single day decline since November and sparked concern that other European countries will need to be downgraded as well. Volume totals on Tuesday were reported higher compared to Monday's totals which marked another distribution day for the major averages. Decliners trumped advancers by a 5-to-1 ratio on the NYSE and by a 4-to-1 ratio on both major exchanges. Meanwhile, new 52-week highs easily trumped new 52-week lows. There were 28 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, considerably lower than the 91 issues that appeared on the prior session. A healthy crop of new leaders making new highs bodes well for any market rally.

Stocks got smacked as concern spread that other European nations may default on their debt. So far, Greece, Portugal, Spain and Ireland are the weakest nations in the EU. The news sent the dollar surging which invariably put pressure on dollar denominated assets mainly stocks and commodities.

On the home front, the much anticipated Goldman Sachs (GS +0.66%) testimony began on Capital Hill. Several Goldman executives, including Fabrice Tourre the young trader at the center of the mess, spent their day testifying on Capital Hill. Mr. Tourre read a prepared statement on his role marketing the Abacus collateralized debt obligation (CDO) at the heart of the investigation.

It is important to note that the major averages have been steadily rallying since early February and a pullback of some sort should be expected. Tuesday marked the latest distribution day since the rally was confirmed on the March 1, 2010 follow-through day (FTD). According to the paper, there are 7 distribution days for the NYSE, 6 for the S&P 500, 5 for the Dow, and 2 for the Nasdaq. This puts some pressure on this 9-week rally, but has yet to cause any technical damage.

PICTURED: The Nasdaq Composite Index's loss on higher volume was a sign of more distributional pressure.  

Among Tuesday's influential decliners were the Retail Index ($RLX -3.24%) and Bank Index ($BKX -3.08%). Keep in mind they are each up considerably year-to-date as the Bank Index (+31.47% YTD) and Retail index (+20.93% YTD) have clearly helped underpin the market's considerable recovery rally. Energy shares slumped badly as the Oil Services Index ($OSX -4.07%) and Integrated Oil Index ($XOI -2.69%) slid lower.  Tech weakness was led by the Semiconductor Index ($SOX -3.50%), Networking Index ($NWX -2.84%) and Internet Index ($IIX -2.09%).  The Healthcare Index ($HMO -1.38%) and Biotechnology Index ($BTK -1.13%) held up better than most groups and the Gold & Silver Index ($XAU -0.35%) held its ground admirably. 

Charts courtesy www.stockcharts.com

PICTURED: The Broker/Dealer Index ($XBD -2.80%) suffered a loss today that pressured it near its 50-day moving average (DMA) line as its rally again stopped short of its Oct '09 recovery high.

Ezcorp Inc (EZPW -$1.19 or -5.10% to $22.15) suffered a considerable loss today on above average volume, closing below its pivot point and prior chart highs, raising concerns. It recently rose from a 5-week flat base, so resistance is not in the way for this high-ranked Finance - Consumer/Commercial Loans firm if the market rally continues. EZPW has been noted recently as extended from its latest sound base of support after triggering a new technical buy signal on 4/20/10, having completed a new base and broken out following its last appearance in this FSU section on 3/29/10 with an annotated graph under the headline "Financial Firm Consolidating After Getting Extended."

Earnings per share increases have shown acceleration along with greater than +25% sales revenues increases in the latest quarterly comparisons (good C criteria) versus the year earlier, and a great annual earnings history (good A criteria). Its 50-day moving average (DMA) line and its recent chart low ($19.73 on 3/16/10) define near-term support above prior chart highs.

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