May 4, 2012 S&P 500 (SPY @ 137.00) looks top-heavy
The S&P 500 issued a sell signal on April 9 locking in a nice 8% profit so you should be flat or short. The market failed to follow-through on the downside following the April sell signal which is usually bullish, meaning the market should be watched closely for a re-entry point, but the fact that it failed to either trigger a new buy signal or take out its 142 high (which are essentially the same thing) and now sold off on heavy volume are bearish. A break to the downside is likely. Plus, we are now in the historically weaker May-October period.
The S&P 500 issued a sell signal on April 9 locking in a nice 8% profit so you should be flat or short. The market failed to follow-through on the downside following the April sell signal which is usually bullish, meaning the market should be watched closely for a re-entry point, but the fact that it failed to either trigger a new buy signal or take out its 142 high (which are essentially the same thing) and now sold off on heavy volume are bearish. A break to the downside is likely. Plus, we are now in the historically weaker May-October period.
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