I know I said yesterday that we still looked fine, but remain cautious. That still remains true. I expect a pullback soon and here are FIVE reasons why - 

5 days now of consolidation with lots of doji closes, while this is bullish (in some sense) I sit more in the bearish camp - 
1. Vix reversal today
2. SOLID resistance above
3. A little extended on the upside (still)
4. The banks (leaders) took a dive today, more importantly, $BAC took a dive. 
5. Wicked down a little, though that is not that significant.

Those are my five reasons for being short a little now. IF we do pullback some I would look to buy long again but remember, a market "ebbs and flows" so be careful not to get caught in the wrong direction. The risk:reward is NOT in favor of the bulls right here in my opinon  we are at some SOLID resistance and came a long way. Earnings also may be a "sell the news" type of a event, given how far we have gone. 

Apple is a non event at this point. Love my phone, HATE the stock. It is going lower, 500 is still support - though based on this action, it looks like it will break it.

Google is basing nicely. Looks like it wants higher, good volume pattern.

Amazon pullback a little, I will wait for a more confirmed signal. Do not buy blindly. Still looks fine though, at ALL time highs.

Banks, our leaders do worry me a little bit. $BAC (our main leader) sold off pretty harsh today and I think it can go lower. I am firm believer in the fact that LEADERS, LEAD - and therefore, the market very well could sell off a little more. 

Trade accordingly. If you would like to contact me for questions/comments please visit the contact page. 
1/9/2013 16:51:11

if you're still 17 like your bio says..you've impressed me. keep at it, just don't put all your eggs in 1 basket

and remember, the market can stay overbought, until it doesn't. TA is good for making sense of "past events" but it isn't a tool to predict a future, only to give you an edge on what "could possibly" happen.

Ben C Banks
1/9/2013 17:12:02

I know the market can stay over bought, but I never said "overbought" I said "extended". I do believe TA is a reliable way of stocks investing, and trading and CAN help "predict" or anticipate what is likely to happen in the future. But that is just me, everyone is different, and has a different style.

Yes, I am 17 by the way.

1/9/2013 18:34:34

what i meant was, while you have 5 reason it might pull back, it doesn't have to. they keyword is "might"..for all you know it can break out to 150 tomorrow (obviously we can say that's highly unlikely), but if it does what would you say...i know for a fact that most chartist will say "well it was a bull flag" and they'd be right.

and if it drops to 144.67 tomorrow...most chartist will say, "well it was overextended (which is overbought, btw)" and they'd be right also.

see what i mean?

Ben C Banks
1/9/2013 18:44:12

Ok, well that makes sense. It is all about the probabilities. You are right when you say it could, but the odds are not in the favor so I put my money in favor of the odds. I agree nothing is fool proof. Also, when you say extended is overbought.. I do not agree. I know some people may look at them the same way but I do not believe in the term "overbought", it can't be "overbought" but it can't be extended. I do not think that makes but it is the best way I can explain it.

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