Stocks Sell Off As The Bears Take Control

Today stocks sold off sharply with the dow down 185 points. For the past two weeks I've been posting as to why I didn't want to be long stocks. In fact, I'm short and we're now starting to see downside momentum pick up.

Above is a daily chart of the dow. It appears that a double top formation has taken place and an important trendline was broken today.

Notice on the last two down days how the volume has increased which helps confirm my bearish outlook.

Many of the interest rate sensitive stocks that I have short are leading this market down such as the utilities which I will post about later.

I'd like to stress one more time that I am NOT looking for a crash in the market...I just feel this summer we will see stocks consolidate and trend lower and I'm sure at some point in a few months there will be a good opportunity to buy stocks. Yesterday I pointed out that I'm watching the Asian stocks for potential longs if we get a good dip in the market....but as of now I am all short.