Wednesday, April 2, 2008

Equity Market Comment - 4/2/2008

The lack of follow through today, while not exactly what I wanted to see, still was not a huge negative. This is because there really was not much downward pressure today and actually as I watched the futures trade today there was some fairly aggressive accumulation going on.

Now the chart pattern that we currently have is a crossroads pattern, in other words, the market could go one way or the other from here. I am favoring a small continuation of the rally for a couple of reasons.

First, the major momentum models actually ticked up today and kept the upside inertia in tact.

Secondly, Thursday is very typically a decent day for higher stock prices and even more so when Wednesday is a down day.

Remain with the conservative 60% allocation and for those of you who are trading the 3 day cycle with me, we can look for a place to buy in the money SPY puts tomorrow if we see higher stock prices.

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