THE POISON REMAINS THE SAME, MARKET SEEMS TO STILL BE CONFUSED AS TO WHICH TO PICK
The market seems to be having a difficult time picking its poison here. If you are so inclined, it may be an opportunity to begin bringing in your long positions and scaling into some shorts over the short to intermediate term. There is a coin-flips chance that the S&P breaks out of this 4 day pinch it has worked itself into. At which time, it will be clear that it has chosen the second form of poison, as outlined a couple days ago. Here's the description from Feb. 2nd:
2. The S&P 500 blows out the top end of its ascending channel, going into overdrive and annihilating the bears completely and totally. On the surface, this may seem like a dream to the bulls. In reality, it will prove a lot more damaging in the long run. It will be similar to Charlie Sheen on his last bender before entering rehab. It’s reckless, may cost the bulls a lot more money than its worth and will prolong the misery of the coming correction phase, otherwise known as rehab.
The opinion remains the same. A strong surge upwards by the bulls, will be counterproductive to their long-term efforts. It will be a reckless move by an ill patient. Nevertheless, traders must be prepared for all types of outcomes. Keep in mind that this outcome remains a possibility here, as the market seems confused as to what it wants to do next.
