If you play in traffic, you can get killed. If you are watching a car race, you are better off watching from the stands rather than dodging cars on the track. We may be better off watching Friday's market from the stands rather than trying play in the financial traffic.
The market is acting "toppy" with a lower high and lower low on the Dow and S&P. The Dow lost -133 on Tuesday, gained +113 on Wednesday and was down -234 at the lows today before closing with a -174 loss. This high volatility is a symptom of a market top.
After posting a seven-week rally the index has gone sideways for the last two weeks The 17,544 close is 50 points below the close on March 18th then the index first reached this level. Today was the lowest close since March 29th.
The S&P closed at 2,042 and also below its March 18th close of 2,050. These are lower highs and lower lows and suggest the market could be headed lower. There is support at 2,040 on the S&P and again at 2,025.
The problems are many and include the global economy, Japanese Yen, U.S. economy, earnings and the Fed. The S&P futures are down -4 points we I type this.
I am not recommending any new plays tonight until we see which direction the market takes on Friday.
NEW BULLISH Plays
No New Bullish Plays
NEW BEARISH Plays
No New Bearish Plays