Securities Research Services

Monday, October 27, 2008

October Low Unlikely to Hold

October's low clearly is in jeopardy of breaking down. Considering the lack of bullish divergences on any major index or on the majority of stocks a break through the October 10th low has a great deal of potential to create a panic washout.

Moreover, sentiment readings remain surprisingly bullish with 52% of the traders still looking for a bullish bounce against only 21% looking for more lows to come. With readings like this and with the sellers still in charge of the tape, the short side looks to continue to be profitable.

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