Yesterday's brutal market turned all of our momentum indicators down. We not quite ready to call a new down trend, but clearly the eye of the hurricane has passed over us and the back side of the storm is now hitting us. Whether it will be bad as the initial hit is to be seen. Nevertheless, today is a day to sit back and watch what happens. The next day or two will tell us if the momentum has taken a shift and if we should shift our trading accordingly.
By the way, true to our name we will not ask why the markets took a whack yesterday. We know the conventional wisdom was that it was because of the ISM report. However, the ISM is such a weird indicator that its hard to imagine that it could move the market the way it did.
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