The SP500 has for the moment failed an important breakout. Although the index could recover and move back up through the prior breakout point (see other posts from past two days please), the risk has gone up that a correction will occur. We formed a double top and the index attempted and failed to close ABOVE the breakout point represented by the November high. You can see that Nov. high to the left in the chart below.
What to do?
Read my article about “Passive Shorting™” on my website SunAndStormInvesting.com or you can “Google” it and find 3 articles I wrote about how to handle these failed double tops.
Remember, that there is NOW a failure, but we have to see how the index behaves. It could recover despite the risk of a correction that has appeared. That is why in general I recommend scaling in and out of the market in steps rather than jumping in one move.
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Enjoy your day!
Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.