In recent videos, I discussed what the market needed to see after the October 6th Follow Through Day. Accumulation was one thing on the list and unfortunately, the market is seeing the opposite. There are not only more distribution days on the Nasdaq Composite, but the volume is accelerating. The recent price action this week has led me to reduce exposure significantly. I will discuss it in more detail in this Weekend’s Video, but the purpose of this Market Note is to remind members to stay defensive! All the major indexes are below their 50-day moving averages, telling us that the institutions are not currently supporting this market. Remember, you MUST have a loss cutting discipline on your positions based on your timeframe. Use a Friday decisive close below the 10-week as your guide, and my absolute “line in the sand” stop on long-term positions would be a close below the 200-day. Good luck with your decisions. As always, if you have trouble making decisions, partial sells can also help to reduce risk.
