Chart Courtesy of StockCharts.com

Goldman Sachs (NYSE: GS) And Google (Nasdaq: GOOG) are sending a message of caution to the market.



Chart Courtesy of StockCharts.com



When market leading stocks are nowhere near their 52 week highs, you have to wonder about the state of the market. And these two bellwethers are way off the mark, suggesting that not all may be well in Stockland these days.

Both stocks have been making lower highs and higher lows, which means that they are in down trends. Google, though, is still above its 200 day moving average, so you can make a case for it being in a long term up trend, despite intermediate term weakness.

Goldman Sachs, though, is a different story. The stock is fighting to move back above its 200-day moving average. And the action there in the next few days could be crucial.

That brings up two possibilities. One is that Google and Goldman are no longer market bellwethers, so that their performance doesn't matter. This is unlikely, though, given their visibility, and their positions as leaders in their industry sectors.

The other possibility is that the market is starting to sense that big troubles could lie ahead and that the smart money has been heading for the exits.

It could take months to prove if this analysis is correct, but it's worth noting anyway.

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