Like Spring in Maine ... Slushy

NYSI/Cumulative breadth is still pointing down:



The daily chart shows signs of being "oversold" but is unreliable:



And the weekly chart is only 3 weeks into a "sell" signal. Sell signals on a weekly basis almost always last longer than 3 weeks. Sometimes much longer:



Sentiment is falling into line exactly as expected. There continues to be an increase in put buying, and public sentiment gauges are showing a persistent tilt to the bearish camp. All of this is conducive to the cleansing out period we are in, and is setting the stage for a nice rally/recovery. Perhaphs a real "summer rally"?



In the meantime, there is enough energy stored up in the decline to support a bounce at any moment. The daily and weekly both suggest resistance at the 1412 to 1414 level. I still expect any further sinking into this slush should be limited to the 1325 area, while any sudden collapse to 1275 would be a spectacular buying opportunity.



Good luck in your trading this week. Remember what Baruch said, "Buy straw hats in the winter, for surely spring will come"



mm