A Countertrend Trade for the Bold
Last Thursday, in view of the decisive drop through support by the S&P 500, I was looking at the 1335 level as a likely target on the downside, at least for the short term. So yesterday's low, prior to an attempt to rally, when it came in just above 1336 appeared to confirm the validity of the level. Moreover, the slide has lasted so many days that some strength is to be expected soon. Also, the shorter-term Arms Index moving averages are somewhat oversold.
So a rally in here is to be expected. Remember, though, that the break last week, as we have noted before, was a warning that the intermediate-to-longer-term direction of the market had evidently turned down. So a long position here, while it could be profitable for nimble traders, is a bet against the now established trend. Be careful, and if you do decide to play it, do not overstay!...239 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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