What a turn of Events….6/29/10

Well after getting an all clear signal to go long in the stock market two weeks ago, it looks as though it was just a head fake. This happens time to time and you just got to roll with it. If the current week ends below 106.77 we will officially have a new down trend established.  After Monday and Tuesdays markets, we have a lot of things to look at and be ready to pull out of the market.

First, the weekly trading bar as of right now is completely below the 50 week moving average which is a signal of a change.

Second, the RSI is below 50 so it confirms the first signal.

Third, the support point of 104.58 was penetrated today and actually closed a few pennies below that at 104.21. This is very concerning and something that really needs to be monitored.

Fourth, we now have a lower high and what we call a pivot built that shows a distinct down trend. If the S&P trades the rest of the week below the 50 week ma and closes below 106.77, a down trend will have been confirmed.

Friday morning if all the above statements are still holding true, I will withdraw my C-Fund and deposit it in either the F or G funds.

Look at my latest chart, refer back here to understand the markings on the chart and you will see that it is looking bad. Let’s just hope that we get a rally that will reverse the current negative trend.