The market dipped but reversed nicely to close in the plus column. So far, the indices remain set up as Trend Pivot Pullbacks. Therefore, last Tuesday’s pivot high remains the inflection point. If that high gets taken out decisively then it would suggests that the trend is resuming. If you are looking to gain exposure to the overall market via index ETFs, then wait until that high gets taking out.
As I often preach, it is our job to build a case for market direction and then look to tear it down. Right now, the indices and most sectors remain in uptrends. So the trend remains up. There are some caveats though. As I’ve been saying, interest sensitive areas Real Estate and Utilities remain in solid downtrends. And now some other areas such as Telecom and Food & Beverage have been sliding.
It is not the end of the world but I would be concerned if more and more sectors begin to weaken.
For now, I think the best bet is to continue to err on the side of the overall trend.
So what do we do? The plan remains the same. Continue to look to add on the long side. At the risk of preaching make sure you wait for entries. If the stock doesn’t go up (to trigger), then don’t buy it. On existing positions you know the routine: take partial profits as offered and honor/trail your stops higher.
Futures are flat to firm pre-market.
Best of luck with your trading today!
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