UPDATE

Thank you for messages of condolence for Chaz. If I failed to post your comments, please re-send your email so that I can get it posted. You can also just click on the "comments" link at the bottom of the blog posting. Today was a flat day in the market. We didn't get the oversold rally, but I still think that move is coming. I probably won't have any new recommendations until a see the rally....which could last a few days. You could try to trade the rally with short term day or swing trades, but I think the smarter move will be to wait for the rally and set up your put options for the next move down. I still think this market will get to 1250 soon. How it gets there will be harder to predict. Trying to predict an oversold bounce can be very tricky. This is why I told you to wait for confirmation on those bullish picks from last week. Many of those ended up dropping below their 50 day MA...especially on Friday's drop. The simple confirmation of waiting for a close above the 10 day MA should have kept you out of those trades...and prevented a loss. The move down on Friday completed a down week. This down week was somewhat predicted by the "outside week" or bearish engulfing pattern from the week before. Like I said in the blog posting several days ago, this signal doesn't necessarily predict a large move down...but it does give us a high probability for a move down. We got that last week. As far as an expectation from a bounce...I think the market could try to rally back up to 1295 and test that resistance. The SLV and OIH bearish trades still look good. Stocks don't go straight up or straight down, they stair step. For this reason, don't be surprised if these two stocks rally up a bit if the market rallies up tomorrow. You might have to show some patience.