Play Editor's Note: The major averages have been consolidating sideways in a wedge-shaped pattern. Normally patterns with higher lows and lower highs are neutral. The breakout could go either way. However, history would suggest that the prevailing trend, in this case lower, tends to reassert itself. That means odds are greater that the markets will breakdown not break higher. A large number of bearish engulfing candlestick patterns today also suggest the next significant move will be lower. Now whether or not the market merely tests the January lows or surpasses them is a good question. At this point I would hesitate to open new bullish positions and start looking for new bearish plays.
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