That's how I am calling it. As I wrote in my post last night, I was expecting a bounce in the markets and even presented some charts to back my case. Well, not surprisingly, the bounce did happen. But not impressive....not impressive at all.
Either way you look at the bounce - the strength of the bounce or the volume behind the numbers - it wasn't very encouraging. Some of you readers might not agree with me but I expected more than a 6 point bounce in the S&P after a 60 point drop in the last three trading sessions. So, that's why I am giving today to the bears. I am attaching the S&P chart below for your perusal. Notice how it ended in the lower end of the daily trading range and the lower volume compared to the last two trading sessions. Since the DJIA and Nasdaq charts pretty much tell the same story, I am not attaching them.
Personally speaking, I got out of my SBIB position for less than 1% profit at 5.38. And good thing that I did, as it made a low of 5.18 after I sold and finally finished at 5.01 It was certainly pleasing to finally get a trade right after the week I had last week. Sometimes, a well-traded loss gives you a lot more satisfaction than even a 10% poorly executed profit. I took a very small position in RMD at 53.20 in the later hours of the day in the hopes, or rather with the plan, of catching a potential breakout. See the chart below. The volume seems good and a move above the high of the day today could quite possibly lead to a big move up.
Overall, I am still inclined to agree with my post from yesterday - any bounce on weak volume should be shorted. I still see the high volume decline last week as an indicator of a looming correction. However, we are in a news-driven market here and whether you are bullish or bearish, taking smaller positions and trading less is probably the thing to do.
Take care and good luck trading!
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