Tuesday, July 27, 2010

Stay Patient... $Market Still Needs to Prove Itself

Market at a critical point.  At this level the market will need to prove that it can take out the June highs and hold them.  Historically this would be the area where the market starts to distribute for a second leg down or major shakeout.  So if you're still not long, you'll get your chance.  Right now it's hard to tell if this is a bear market rally or the real deal.  The many breakouts point to the latter, but there is still a question of volume on many of them.  Historically markets have presented multiple entries into a real bull.  So stay patient and don't over commit...just yet.  My models still have this market in the neutral zone.  That could change this weekend, but we will need to see the volume come in.  I would remain mostly in cash and cautious.
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