MARKET NEARING 10 DAY MOVING AVERAGE

I told you before I left on vacation to watch for the S&P 500 to drop below its 10 day moving average. If it closes below this average, it could quickly drop down to its 50 day moving average within a few days...much like it did back in November. There are many divergences showing up in the market...they've been showing up for weeks. The market has continued to move higher despite these warning signs. Today's selling showed that the market might be ready to start that correction. The VIX started to spike up a bit at the end of the day and the S&P 500 had a big move down (1%). Watch to see if the selling continues tomorrow...particularly if the S&P closes below its 10 day MA. If it does, start buying puts. For an easy trade, you can buy puts on the SPY, DIA, or QQQQ. Financials look like they are heading lower. For financials, you can buy puts on GS, MS, JPM, BAC, COF, C, etc. Technology stocks are also looking weak. AAPL should sell off a bit...maybe down to around $325. AMZN could follow. It might be time to take profits on MRVL...by the way, send me success stories if you traded this pick. The dollar is down around a 50% retracement (61.8% on the UUP) of the last move up. It could start to rally within the next week. If it does, you can trade the dollar using the UUP.