We’re
probably due for some more declines.
I’ll watch the market tomorrow to decide whether to reestablish short
positions. We hit our 1175 target based
on a 50% retracement back toward the previous high. Since I still think we will test 1119 again,
we should be able to make money short at least down to 1119. This is not as sure as the previous short because
we are further into the correction now and the other bounce was off the first
low.
I
number the lows in a correction as each lower low occurs. The 1st low is the point that is
the lowest low before the market turns up. The 2nd low will happen when a new
low is set and the market again turns up.
1119
is the first low we made in this downturn.
It would be unusual for a correction to end without making further lows
before we exhaust selling; therefore, I don’t think 1119 will hold. We’ll see.
I
will go short in the trading portfolio if tomorrow is a big up-day since that
might signal the end of the upward movement.
There is a bias for big up days to be followed by down ones. Otherwise, I’ll just see what happens.
The
NTSM analysis is a HOLD today after yesterday’s Hold.
I sold on the 27 July sell signal at S&P 500 1301 and I am
defensively positioned with only a small amount of my portfolio invested in
stocks. (Zero stocks in the 401k.)
