Adding to the negative action today was the damage done in many individual stocks today. Here's a list - I don't have time to post them all but copy and paste into a watchlist in Telechart and you can see the carnage. When names like IDT and BOOM (both of which flashed recent buy signals) act so poorly after their signals, that is a major warning sign for traders to pay attention to. Please do so.
MDT, LNG, IDT, CVGI, MHR, PCX, REDF, VHC, FTEK, MBI, BOOM, APKT, PUDA, NCT, RVBD, DQ.
I was able to avoid too much damage today overall as I have been tightening my stops recently to protect any gains I have had over the past two weeks. Two stops were hit today - BOOM at $21.81, giving me a 2.9% loss. I entered this stock yesterday morning. IDT was also stopped at $26.36, giving me a very slight gain of 0.5%. I entered this stock a week ago on the 12th. I am still holding my other three positions but stops are in place on all of them in case this market is topping here. Hopefully your stops limited the damage done today as well.
My system will flash a "caution" signal today, which means overall, cash is the best option right now. Based on my system, it will take a move above today's high in order for me to look at going long again. I will manage the positions I have but I would hesitate doing anything else until we see if today was just a one-day bump in the road. There is no "sell" signal yet, so I am not shorting, but if we see downside follow-through tomorrow, I will begin to look at some inverse ETFs. If you're looking at an individual sector to focus one, I would look at gold, which has shown many sell signals over the past few months and looks very, very, very toppy here.
Charts from Telechart, Courtesy of Worden Brothers, Inc.
Good luck Thursday - hopefully you've been paying attention and weren't hurt much today. We've had a great run so far in 2011, but now is the time to pause and see if today was the first shot across the bow for the bears. Tomorrow should be interesting.
** Oh yeah, if you are doubting my signals, how about GGAL? That's the only stock I posted yesterday as a potential long candidate. Today - up 6.5%. Not bad.