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The indexes and a lot of stocks came right up against resistance on Monday and failed to break through.   The daily chart of the SPY, below, shows how the S&P 500 index could not hold above its declining 30 day average (red line). Last week’s   bounce off of   extremely oversold levels appears to be over.   I bought some QID Monday, hoping to make money as the QQQ declines. AAPL is one of the stocks that stopped at resistance on Monday, as did V, NEU and CMG.   I am in cash and/or short.

The daily Guppy chart (GMMA) shows that the gold ETF has been in a down-trend.   The short-term averages (red) are up against the longer term averages (blue).   It remains to be seen whether GLD can break through this resistance around 157-158.   The GMMA is composed of 12 exponential moving averages:   3,5,8,10,12,15 and 30,35,40,45,50,60.

Yes, the QQQ remains in a short term down-trend.   Only time will tell if this rebound is a real end to the correction or just a bear trap.   Typically, down-trends don’t end so suddenly, and without panic.   But if the GMI returns to 4 or greater for two days, I will go long again.   The important thing is to wait for a definitive signal of a change in trend. IBD still calls the market in a correction.

The daily Guppy chart of the SPY shown below shows that the S&P 500 stocks remain in a solid down-trend.   Note that all of the short term averages (red) are well below the declining longer term averages (blue). Compare this pattern to that in the prior up-trend.   The fact that we are still in a down-trend should be very obvious.   When the red lines are back above the rising blue lines, it pays to be long and fully invested.