chuckination

Bear Market Rally Selloff Beginning

Short
AMEX:SPY   SPDR S&P 500 ETF TRUST
Well, I publish an idea last week enthusiastic and euphoric it was going for the moon, but admitting when you're wrong when your stops hit means it's time for the other direction. Between the last couple of weeks cooling off and prices falling below prior support trend lines and failing to break back over them as resistance means the short term trend is changing direction.

The momentum as reflected in the rate of change has been rising, but has still failing to reclaim a positive direction from a month ago and is again falling. I don't expect this to be as hard or as fast as March, but it could be. The size of the Bear market down trend channel is huge, but after the moving averages bunch up and the price bounces off of the 252 day average as a resistance, expect huge moves downward this week. I would not be surprised to see more circuit breakers get hit again, but I'm only about 33% of my portfolio short right now and am waiting on confirmation that the down trend has resumed in earnest to go further short. Selling volume is beginning to rise, and the weekend down is looking pretty hard down already. Stochastics and RSI are all breaking back downward, so it looks like the Bear rally is dead and about to swipe back down again hard. The distribution is just beginning, and I expect it to pick back up in force on Monday.

-- NOTE --
I've made some changes to the Rate of Change ( ROC ) indicator that are shown here, but have not published the script. Let me know if you're interested, and it goes from hard green and red buy and sell to blue for cooling uptrend and purple for recovering downtrend.

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