THE TOP?

There many reasons to believe that a top was reached yesterday. AAPL was a good example. I don't think I've ever seen the stock this far away from its 50 day MA. Watch to see if the market gaps down today and closes near the low of the day. If this happens, we might expect there to be continued selling. See if the VIX closes at or near its high of the day. Last week the VIX spiked up on the Goldman Sachs news, but finished the day well off the intraday high. If it closes at the high, it will signal that the "level of freaking out" is strong...and possibly increasing. If it looks like the market will close on its lows, you can buy a put option on the SPY, DIA, or QQQQ and play the expected move down. Many of the bullish recommendations I gave the other night have not (or did not) get confirmation. The confirmation that I normally look for is a close above (or below on bearish trades) its 10 day exponential moving average. If you are in call option trades, make sure you have stops in place. If you don't know how to calculate a specific stop, you can try using 50% of your purchase price. If you bought the option for $4, you could stop yourself out if it reaches $2. Don't panic and jump out of trades that are working. I've called possible tops before over the last month. We still don't have much confirmation yet that this market is on its way down.