Slowing Momentum

Slowing momentum caught up with the market
 
Last week we commented that since the "BUY" signal of August 14th, the market had continued its upward movement, however with the development of slowing momentum. The week before last, the market made a significant adjustment downward, about a 2% drop which put our indicators into a caution mode.  Last week the selling pressure continued, which put our indicators into a "SELL" signal which was executed Friday.   Therefore, as of last Friday we converted to an inverse, defensive position and will remain there until a "BUY" signal is issued.  It is too early to tell if this selling is going to result in just an Intermediate correction (5% - 10%) or morph into a Major (10% - 15%), Primary (15% - 20%) or in excess of a 20% correction, Bear market territory.  Only time will tell.  We are ready to play Offense or Defense, based on whatever the market gives us.

​Weekly S&P 500 Chart (with all-time hi shown)

Monthly S&P 500 Chart (with all-time hi shown)