Market carved out a hammer candlestick pattern today retracing nearly 300 points on the DOW. There is definitely potential for a sharp correction over the next week or so before the lows get tested and probably broken again.
I will be waiting for a rally, then reveral so add to short positions.
As I was talking about yesterday, the futures markets in th US are sharply lower this morning (YM down 2.3% as I write this). We are most likely going to break DOW 10,000 today. Get ready for much lower prices.
If you are not short already, don’t try to get in now as there might be sharp pull-backs.
If you follow any asian markets, here’s a quick look at India’s bombay sensex index. There is no place to hide.
As I had mentioned in my previous post, I am expecting much lower prices in the stock market over the next 6-12 months. Here’s a chart that shows the last few years and what is developing. Wave 3 is ready to head down its path of destruction.
Get ready for 500+ down days in the DOW. Get ready for lock limit days.
All the major indexes have closed below their 200 day moving averages. This is a scary place to be for an index. Take a look at the chart below:
I am showing the SPY, QQQQ, DIA, and IWM. While I am expecting much lower prices, be careful of sharp rallies in the market. The intermediate term (6 months) trend has definitely turned down. What that means is all rallies should be taken with a grain of salt and shorted.