that IBD put the Big Picture in “Rally Under Pressure”. This always gets me lighter and more flexible. Combine that with a new quarter and it made sense to get the foot off the throttle entering this week. This morning IBD changed the technical picture to “Market Correction”.
Some have asked, what does that mean?
A “Correction” is a loosely defined term” as 3%-5% decline from the recent high is big enough to be a correction. So is a decline of 10% to 19% (an intermediate-level correction) or a drop of 20% or more(the typical definition of a bear market) No one knows what type of correction this will be, this is why I will measure Technical levels along the way for composure and opportunities. (ibd big picture) I DON’T Think we get the 22% move off the highs like we saw last year. But I put 75% odds we see 1370-1375 and 50% odds we see 1340. These are big technical spots.
Today, the Futures are down about 8 handles as the McClellan Oscillator is -50ish ** Getting to levels where intermediate shorts should be covered and we can get some type of oversold bounce.
We’ve already broke the upper momentum trend. Today we will be testing the Intermediate Floor. Now 1386-1388 is a big area. I think if you are still short from Tuesday- this would be a good spot to cover the remainder. I will cover the rest of my SPY short below $139. The 1370-1375 level is the prior breakout level from late February and also has the 50day moving average. This will be first spot macro investors should look to add to longer term positions (I don’t think we see this today).
See how the leaders act today, to see if we can get some type of oversold bounce as some might try and flatten out as we have a long holiday weekend combined with a Jobs Friday.
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