By Chris Vermeulen – www.TheGoldAndOilGuy.com
As talked about almost two weeks ago when the SP500 trend reversed to the down side we have been waiting for a bounce in price to short the market (buy and inverse ETF). That happened last week and now we are waiting for the market to shake out the short positions and suck in as many traders to get long before the next wave of major selling takes place.
It seems traders are becoming bullish again as prices rise and they are dumping their precious metal positions and rotating into equities again from the looks of things. Also if you know the Dow Theory then you know the industrial and transportation sectors tend to lead the broad market. Well today the only two sectors trading lower are just those two.
See the charts below for a visual:
All these things paint a clear picture for lower prices to come. But as we know, surprise news can change the technical outlook of the market from time to time. This is why constant analysis is needed along with protective stops for any open positions.
Chris Vermeulen
www.TheGoldAndOilGuy.com
