Market Remains In A Correction; Day Count Reset

All the major averages sliced below their recent lows which means the day count is reset and we are now looking for Day 1 of a new rally attempt to occur. At this point, the 200 DMA line (i.e. 40 week-moving average) remains support for all the major averages while the 50 DMA line is resistance. If the 200 DMA line is breached, on a closing basis, then odds favor lower prices will follow. The converse is also true. Until either event occurs, we should expect this sideways action (between the 50 & 200 DMA line) to continue. What does all of this mean for investors? Simple, the market remains in a correction which reiterates the importance of adopting a strong defense stance until a new rally is confirmed. Trade accordingly.

Investors Digest News From All Corners Of The World

Tuesday, April 6, 2010 Market Commentary: Stocks opened lower after the Australian Central Bank raised interest rates for a 5th time by a quarter point to +4.25% and Greece rejected an EU-IMF aid package. The market’s internals remain healthy as this rally enters its 6th week since the March 1, 2010 follow-through day (FTD). It…