Tuesday, May 28, 2013

1625-1635 to be challenged?

The market looked bullish today by gapping up big early morning today and ending the day green. However, the substantial reversal that took place after the gap tells a different story. For the first time in quite a while, rallies are being sold into to which a sign of distribution (from the big guys to the unsuspecting future bag holders). So while the market managed a close above the TA, I am leaning bearish betting there will be more closes under the TA. Also, if the reversal wave we saw today was a bearish W1 then I am expecting 1625-1635 to be challenged again but this time it would be the lower end of the range. If this is not the beginning of a bearish 5 wave count then there will be more choppy trading until possibly challenging the 1687 high for a flat correction. If the market is able to regain the TA firmly I will look for bullish set ups and trade accordingly. Until then I am wearing my bear suit for the SP500.

I ended up position trading VXX today and improved its cost average by 10 cents so it is now $18.62. I guess I should have stayed in cash over the weekend!! But it's all good, I enjoy the challenge of being underwater and trading my way out. Last but not least, thank you for all the input on what I could use for phone alerts. I ended up buying a $5 phone (I can't believe they're that cheap) on a pay as you go plan and I signed up for fax2me to get call alerts by emails. Tonight I will be setting it for 1636 and I am hoping to get a wake up call early morning :)

Main S&P 500 Trends

Short Term Trend = Neutral Leaning Bullish
Medium Term Trend = Bullish
Long Term Trend = Bullish 

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