Has the S&P500 broke the almighty uptrend? Listen to the tape. (S&P500)
Today price action told the story. We had a trending down day where we broke previous days low in the S&P cash market of (1037.25)with sustained selling on higher than average volume(132,000,000 more on SPY than average of 189,000,000). This action has not been seen in six months.
The old saying goes, “The biggest market moves happen when you least expect it.” Today was a great example, the longs were sucked in yesterday and smashed today. One of my old risk managers told me, “The market can remain irrational for longer than you can remain solvent.” Best market advice I could ever get.. If you fought the tape up until this point your done, i’ll admit I fought the tape in the beginning but i threw in the towel and got long riding the trend. There is a time and point for every trade, the best traders recognize when they are wrong and flip the trade around.
My point being if your looking to get short and rode the wave up.. sell out your winners now because you cannot go broke taking profits. If the market has/does break this up trend on in the S&P500 then maybe one can argue the tape is pointing to a correction. Listen to what the market(tape) is saying, look at the VIX this week, look at the NYSE TICK, it has been -1000 average for two days, this means stocks are OFFERED not BID.
The whole point of post is to highlight where we are in relation to the trend, draw your own conclusions. With the dollar still holding its ground @ support combined with media hyping a dollar rebound you can bet the trade has already started. When the market was bottoming everyone on television were saying sell, when in reality they knew it was time to buy. It is all psychology, I could be wrong but why not take profits, buy low sell high. +50-60% is not a bad return.