Thursday, May 15, 2014

Possible Market Top

The market sold off today and eliminated the potential bullish count I had been tracking. Also, the level I mentioned yesterday was breached which now sets up the potential formation of a Head and Shoulders if we get a counter rally to test the Trend Average tomorrow (which has gone negative). If the market fails to recapture the TA, the next bearish leg will slice through the 50 Day MA which in turn will probably start a substantial correction.

I started selling the rest of my longs in my Short Term portfolio to raise cash and will add some shorts at the test of the TA with a stop at the all time high. You guys know I rarely call for tops but probabilities are no longer favoring the upside after today. The bulls would have to make a strong reversal day to change my mind.

For further analysis on RUT, NASDAQ, DJI, Gold and Brent Oil please visit

Last but not least, this is the only Technical Analyst I actually pay attention in the media and he apparently went bearish today as well:

Short Term Trend = Bearish
Medium Term Trend = Bullish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors.

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