Nasdaq Showing Weakness, Time To Be Defensive

In Market Analysis on October 28, 2009 at 6:35 pm

Many market indexes and leading stocks are showing signs of increasing supply as the market may have outpaced the economy and the early stage bull market needs to take a breather for general economic conditions to keep up.

From a technical point of view many indexes have broken through long term trendlines and moving averages. Price volume action is poor and momentum indicators are divergent to price which means that there should be a correction or the uptrend should be consolidating.

I am moving out of equity positions on any bounces and will wait for a more favorable trading opportunities as it is crucial not to fight against the major market indices when they turn negative. Asset protection is crucial to being a successful trader.