Coolhand's Market Analysis

Originally Posted by coolhand

The bears made it 2 in a row today. The market wasn't hammered, but it's been trending lower now for over 2 weeks. And NAAIM has been bullish for most of that time. At this point, I have to say that the smart money was too early this time.




Price on the S&P edged a bit further below the 50 dma. It's still not far from that key average and hopefully it won't stay below it for much longer. Price on the DWCPF edged lower as well, but still remains above that same key average. Momentum continues to fall. Volume has only been average overall through the decline.

Breadth was modestly bearish yesterday, but after today it's more bearish. Still, it's been below the 39 day EMA before. And it doesn't generally stay below that level for long (unless it's different this time). I don't expect it to be different, but I can't say the selling is over.

My personal market sentiment generally follows NAAIM sentiment. And because they were bulled up almost 2 weeks ago it was a no-brainer to follow their lead. That's where the money has been for quite some time. But no one bats 1,000.00 (unless you're a central bank).

At this point, I think the odds that the market is nearer the bottom than the top is about even.

I am going neutral. That means that I suspect a bottom is not yet in, but that most of the downside may be behind us. Getting out now could mean missing a big rally off the bottom. NAAIM reports again in 2 days.