More Downside Ahead

Let’s call it what it is… I’m surprised at the strength of last week’s bullishness. My guidance last week was that further upside was likely to be short term, and one week does qualify as short term. Also, we did reference a number of good bullish setups last week, which of course have done very well.

The surprise was that the decent bearish setups simply reversed – and in many cases they reversed strongly. Most of them did not whipsaw, but there were a couple.

Large Cap Tech is largely what’s driving this buoyancy in the SPY and Nasdaq, while the mid cap index is huffing and puffing and still below its Key Levels.

As with last week the QUALITY of many setups isn’t top notch, which is the reason I’m not loading the truck at this point.

Market Outlook:

Well, we’re not getting that washout to the January, June and/or October lows any time soon – and we may not get it at all. More likely is short term upside.

Guy Cohen