Quite a set of signals for SPY today. Stochastic reached oversold, a bounce off the 200 DMA, a bullish doji... We need to get some follow through next week. The 50 DMA is the obvious resistance level to keep an eye on. For many years I've referred to stocks (or indices) that are between their 50 and 200 DMAs as being in no-man's land. They're stuck between being bullish for long(er)-term investors and bearish for intermediate term investors/traders. It will be interesting to see which group wins.

Another selloff today which pushed the SPY and QQQ beneath their Tuesday lows! The % of Stocks above their 50-day moving averages (chart attached or view it on the General Market Overview page) has dropped to 20, so by that measure the market is officially oversold. That doesn't mean that it can't become even more oversold, but I like to use that as a sign that it's time to start covering my shorts and possibly look for some bargains.

Another good day to review the General Market Overview page. This Wilshire 5000 ETF tells the same story as what happened on the Nasdaq, S&P 500 and Dow today -- they all got rejected by or dropped back under their 50-day moving averages. I'll be watching those moving averages closely over the coming days. Remember cash *is* a position! No reason to force things. Preserving capital for easier times is a very valid strategy. I've been content to sit and watch the last couple of days. I'd really like to see the % of stocks above their 50 day moving averages drop under 20. Then I'd feel better about all the sellers being flushed out. Barring that, I want to see the indices close above their 50-day moving averages.

Like I said on Friday, in times like these you should check out the "Strong but Oversold" scan. It's a place where you can often find some good bargains among the market's leaders. I found NVDA there today. It dropped 9% today and closed just above its 50 DMA. Be warned though, it reports earnings in a few days...

Obviously a bad day for the bulls today, with all the major indices down around 4%. What's striking to me is the % of stocks above their 50-day moving averages. (See that indicator on the General Market Overview page). It's dropped to 27%. That's the lowest level in over a year. I pay close attention to that indicator during broad selloffs. Once it gets below the mid 20's that's usually a sign that the market is oversold. So we're really close...