The bulls are showing signs of running out of steam finally with the sell-off on Thursday following the FOMC statement which was followed by the huge gap down lower on Friday. Today looked as if we'd finally see that bounce and after a respectable gap up and rally thereafter, the momentum in the market began to tire and a reversal took place sending the market at one point into negative territory.
Now, the bulls are trying to buy the dip some here in the afternoon but it has been anemic at best. The market looks pretty darn iffy here and if we see the selling continue today and tomorrow we will have the bear flag that has basically been forming (sloppy pattern but still there) over the past three weeks confirm and lead to more downside for the market.
For today at least, I am going to hold off adding any new long positions. Who knows, the HFTs and Algos tomorrow might find a reason to rally the market 50 points higher on the S&P 500 and completely change the dynamics of this market yet again. So it is still imperative to stay nimble and flexible in these ever-changing market conditions.
Here's the Bullish Watch-List: