S&P Closes Below Its 50 Day
Last week I posted the above chart which showed a bearish divergence between SPY and On Balance Volume. I guess that chart had some meaning after all.
As you can see stocks were down sharply today and the S&P closed below its 50 day moving average. Notice the heavy volume on the down days. It looks like the next level for SPY to test would be the low from last month.
The other day I wrote about how the commercial traders are long this market and usually they are correct. My view on this decline is that at some point I will be looking for a place to buy because the long-term trend is clearly up and buying dips is what has been making money since 2002.
As of now I see no reason to be buying so I will remain on the sidelines until I see a low risk setup present itself.
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4 comments:
any thoughts on the builders?
I've been shorting them but I didn't catch this last move down...If you are not short them already, I'd leave them alone.
Kevin... If you practice eliot wave... what is your analysis of the long term charts? Would this have been wave 5 as some people are saying?
I don't look at Elliot Wave...too complicated and subjective.
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