Don't Overstay Your Long Positions

As we suspected after Monday's drop, it was, at least for a while, a false alarm. The lack of volume or follow-through made the move suspect, and the dearth of panic, as evidenced by the volatility index (VIX) and the Arms Index, supported that view. But the subsequent rally has only served to keep the averages in the sideways consolidation we have been watching. 

Note particularly the entry for yesterday on the Arms Candlevolume chart of the S&P 500, below. It has a tiny range, reflecting indecision, and it's typical of the end of an advance....315 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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