The market began to fall
about 11 am when Facebook was due to open trading as a public company. Up until then it was all smiles on the
exchanges and among the new millionaires and billionaires.
MARKET
The S&P 500 was DOWN
3/4% Friday to 1295. VIX rose 2.5% to 25.1. The S&P 500 is currently about 1% above
its 200-day moving average, but I still think the bottom this time will be
lower.
NTSM
The NTSM analysis remained
SELL Friday.
The Sentiment
indicator switched to SELL Friday. Up until now the SELL signal was based on the Volume and VIX indicators. Now, three indicators are negative. That is typical
in a correction. Sentiment is usually
late to call a sell and actually peaks in %-bulls after the top in the S&P 500. That’s because a lot of traders buy-the-dip
not realizing that it’s not a dip – it’s a correction that should not be bought
until the correction hits bottom.
No bottom yet.
MY INVESTED POSITION
I reduced my stock holdings to 30% (0% in stock
in the 401k) at S&P 1358 after the SELL signal on 9 May 2012. (See the page
“How to Use the NTSM System” – the link is on the right side of this page). I cut my stock position to 15% on 17 May in
order to maintain a 10% gain in a trading/longer-term position I had in the QQQ.
