That Sinking Feeling.

Well I have to take a couple of days away from writing @ Solas! and stocks swoon. Equities had their biggest one day drop in about 6 weeks yesterday. The S&P lost close to 3% as did the Nasdaq. We did a bit more trimming in appropriate accounts yesterday as it seems that the shorter term uptrends are at a minimum stalling out right now.

Whether the advance we've seen since early March is taking a breather or this period turns into just another bear market rally is too soon to access at this time. In any case we've dusted off the game plan pages that we've worked on for a market decline at this point. We've been discussing for at least a week that the market's were acting toppy. As we pointed out over the weekend sellers have been coming out during rallies and that is usually a negative sign. We'll see how stocks react in the next few days for more clues. We'll probably write up an "an-tSionna" on Friday-taking a look at where we stand then. One other point is that this is an options expiration week so volatility could move up a bit over the next couple of days.

Two last thoughts. We've been at the top end recently of the trading range we've discussed repeatedly over the past six months and with the rally we've had it is natural to see some profit taking at some point. Stocks can correct in one of two ways: by time or by price. So far it looks like we're in a bit of a price correction but we will have to see. What did move up today was the gold ETF which we own for appropriate accounts. It currently has very positive money flows.

*Long ETFs related to the Nasdaq Composite, the S&P 500 and for risk appropriate accounts ETFs related to gold.