Getting more interesting
With the selling continuing on a quite day we are seeing a more interesting test starting to take place on the NDX. It's back to retest the lows of 11/30 and 12/8 today and a failure on that test could easily take us back another 15 points basis that index. The same is true on the broader NASDAQ as well making a 25 to 30 point drop from these levels a higher probability. Both indexes are below their 20 day MAs now and if they fail, they are likely to drag the SPX below it's 20 day MA as well.
All of this assumes that we get continued selling pressure today or tomorrow. The selling seems to be orderly and on low volume and thus, as I said this morning, it's going to be hard to read anything into the markets as the low volume distorts most volume tells. I guess what I'm saying is to keep it two-sided and careful. If you want to make purchases on weakness, consider your stop outs and respect them. For me, I'm going to continue doing little and allow positions I have to try and work for me rather than trying to make new ones.
All of this assumes that we get continued selling pressure today or tomorrow. The selling seems to be orderly and on low volume and thus, as I said this morning, it's going to be hard to read anything into the markets as the low volume distorts most volume tells. I guess what I'm saying is to keep it two-sided and careful. If you want to make purchases on weakness, consider your stop outs and respect them. For me, I'm going to continue doing little and allow positions I have to try and work for me rather than trying to make new ones.
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