Enjoying our defensive position

Well, well, well. As we were describing in earlier posts today, this market was susceptible to a sharp reversal. Sharp is what we've got with the DOW losing 115 points from its top and the NAZZ shaving 27 points from its peak as we write.

In our earlier post we expressed that Oil would be blamed for the sell off in the stock market. The reason that that is too simple of an explanation is the "tail wagging the dog" theory. When the market is exhibiting signs of being tired like this one was it will search for reasons to use as an excuse for its action. The internals of this market lately have left a lot to be desired so it did not take a rocket scientist to see that this market was about to kick the Bulls in the.......snout.

The NAZZ has breached the lows that were made on Monday, therefore a clear downtrend has been established. We intend on using weakness to scale into long positions if this downward move were to accelerate with fear. However, we will be extremely patient before we buy if the selling shows signs of a slow drift.

-Stay Cautious-

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