Breakdown Watch In Effect

Near term trends for the QQQQ and IWM have been up over recent weeks while the same near term trend for the SPY has been trading sideways, or neutral. Attempts to move higher have all been rebuffed and it now looks increasingly likely we will see a breakdown this week switching the near term trend back to down.

When and if the SPY’s near term trend turns lower it will offer improved risk:reward as it will compliment the long term downtrend. Think of it like a car that gets a tune up and is once again firing on all cylinders.

Today’s scans revealed a great deal of set ups weighing heavily on the short side. Unless the Fed steps in and attempts to rescue Fannie Mae again, or some other vital news emerges, we are likely looking at lower prices this week.