First up is the Small Cap and I’m really starting to get concerned here. We now have 3 lower pivot highs which confirms that we now have a short term downtrend inside the primary uptrend. You could argue that this is a longer term bull flag but I’m not convinced. Also after Friday’s hard pullback, the Small Cap fired warning one falling below the CBL and warning two falling below the 50 day moving average. Using the daily chart and the uptrend line in green, the bailout here would be between $985 - $986.If the week opens up to the negative side, we could have a sell signal very quickly here. So watch.
Bonds also look to me like they are also leaning toward a downtrend. The last three pivot highs are lower than the last and that only means bad things. I’ve had a hard time reading bonds, so I will just be watching here.
S&P 500 had a hard pull back Friday also, but the structure still looks good. No warnings here yet and we just ride and watch.
The International Index held up fairly well Friday. There are no warnings here and structure still looks good. The only concern that I see is that the last pivot high was not taken out last week. No new pivot high has been formed yet, so there is still a chance that the structure will remain intact. If your in, ride and watch. I’m currently not in the I-fund.
Conclusion: Watch the Small Cap very closely and the rest are a watch. This has been a hard year to make any real gains unless you just got a lucky entry or exit.
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