Wednesday, September 21, 2011

Selling The News

The market sold off hard after the Fed announcement, which was to be expected for the most part.  Most knew what was coming, and today was a classic sell on the news event.  It doesn't, however, mean that a resumption of the intermediate downtrend is a given.  

The 12ma of the Qs is crossing up the 50ma, which has been followed by a positive resolution each time it has occurred this year.  Even if the selling lasts a few days like it did in early April at least a rally attempt should follow if not rally highs.  The TRIN closed above 4.0 today suggesting the selling is already a bit overdone, and the McClellan Oscillator is quickly moving to oversold territory.



There are some tempting short setups.  They may work out, but I think it is premature to be thinking that way.  Patience for a renewal of the uptrend may be the best bet until there is a lower high in the Qs.

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