The broad stock market is down again today following yesterday's loss with another sharp drop The DOW lost 86 points at today's closing, but more significantly, strong bearish momentum signals appeared in the charts of the DOW, S&P 500 and NASDAQ indices. This means that directional momentum is now mixed bullish and bearish for these markets, and that puts our bullish trading strategy in jeopardy. The DOW is now close to our ideal buy spot in the 17,600 - 17,700 range. If we enter that area tomorrow or Friday, I will still consider a long position. Any break below 17,579 (the low of March 26), however, would negate the idea of going long and would suggest that the market is turning bearish with prices moving lower for up to seven more weeks (or less if the cycle ends early). I know it is frustrating to be frequently changing our trading strategy, but we have to follow the technical signals, chart patterns and cycle structures when they shift. Unfortunately, that seems to be happening a lot in today's volatile markets.
Still on the sidelines and watching the DOW carefully now for any break below 17,579.