How is the market doing ?
Well we have good months and bad ones. Last 5 weeks the market has been on the side of bears. They have managed to take control again and head winds in the economy have helped their cause. The selling in the last 6 session has been non stop and we broke the 50 day moving average and are half between 50 day and 200 day moving average. This train should stop at the 200 day moving average if it has to. The economy has bad news and hence this correction which will be about 10% from the top of SPX at 1340 on May 2, 2011. We are already 7-8 percent down and a little bit more should exhaust the sellers completely. There is no guarantee but that is more likely. Here is a video for you to watch.
The next great barrier for bears is the 200 day moving average. If the buyers step in here and the sellers and shorts are exhausted than we may find a trade able bottom. Otherwise it is extremely risky to go long and keep losing. The indicators are all very oversold at this point and Technical bounce will come, the selling can resume unless we find a real bottom from which we can move higher or sideways. Take a look and leave a comment.