Today's scans confirm indecision as good trade set ups are difficult to find and those that do exist look unreliable to us.


Scenario 1: The first possible scenario to look for would be a decline back to last weeks lows where support at those levels fail and prices continue lower to the $116 target we outlined last week.
Scenario 2: The second potential scenario to watch for would be a low volume retest of the lows, or even the development of a higher low, which then rallies back up again, this time over the falling 20-day average kicking off a bear market rally that could last 6-8 weeks.
Because of the lack of clarity at these levels and the high level of risk, we would recommend either a cash position here, or, if you must, a hedged position where you are equally long the strongest stocks and short the weakest stocks; keeping relatively tight stops on both. In our opinion, cash is the better position until better set ups develop once again; which is likely to occur later this week.

No comments:
Post a Comment