Outlook August 9

Markets advanced last week, but the move seems to be staling around 2300 on the Nasdaq, 1130 on the S&P500.

With a few Green Period days left this week we could try the upside again. But I would use any up day to take profits on long positions and get ready for the next Red Period.

The current chart suggests that the next Red period could produce a sizable move down.

As you can see, the S&P 500  is barely holding above the up trend line that started in early July. With the next Red Period looming we could easily break down, which would probably see us to 1060-1080 pretty quickly.

Be very careful this week.

Danny