We are now at the center of this week's reversal zone (April 22- May 1). Yesterday and today the NASDAQ made new all-time highs while the S&P 500, and especially the DOW, are both remaining below their all-time highs (26,951 in the DOW and 2,941 in the S&P 500) which is giving us a strong bearish divergence signal. Also, the DOW opened today with a dramatic 250 point drop. There is a good chance we are at a top and a turning point for a final corrective drop in the medium-term cycles of at least the S&P 500 and NASDAQ (the DOW may take a lesser sub-cycle correction) to their final cycle bottoms. I am therefore going to enter a short position in the broad stock market market today. Traders using index fund ETFs should focus on the S&P 500 and/or NASDAQ as their drops may be more substantial than the DOW's. Our stop loss for this trade will be based on both the S&P 500 AND the DOW breaking their all-time highs (given above).
Although we covered our short position in crude oil on Tuesday, I am going to re-enter that short position today. Even though we broke our original stop loss of $66 (June contract chart), we didn't actually close above that mark. Early this morning crude made a new high ($66.28) but is now pulling back sharply from that high. This is bearish behavior and we are now at the center of a reversal zone. It looks like this medium-term cycle is poised to take its final corrective decline (which is due/overdue). A bearish turn in the broad stock market would be supporting this idea. Entering a short position (again) in crude oil today.