Inflation! Did the smart money anticipate today’s CPI report and yesterday’s trading? Who knows, but as a candlestick investor all we have to do is analyze the fact that investor sentiment broke down through the sideways trading range of the past two weeks. The close below the T line yesterday in the indexes revealed the probabilities of a new market trend. Any long positions require even more compelling reasons to stay long today. Be predominately short.

The Dow and the S&P 500 trading lower today have moved those indexes back below the T line. The NASDAQ is hovering at the T line. The indecisive flat trading of the indexes over the past two weeks produce the prospects of another wave to the downside based upon stochastics being in the overbought condition and indexes not trading with any great upward trajectory. Be careful of long positions unless they have compelling bullish charts. Start orienting more toward the short side.

The indecisive trend of the market is illustrated by the indexes hovering at the T line area. The biggies continue to trade in a sideways mode, AAPL up right now, AMZN down. However, the strong patterns continue to perform well.

The consolidation phase of this market trend remains in progress, or a better way to state it, the market is still indecisive. Have both long and short positions in the portfolio.

The market indexes remain in an iffy stage. The Dow has pulled back to test the T-line. Note that numerous stocks have use the T-line as support so far today. However, be aware of the lack of bullish indications in the indexes. Each individual stock chart remains the prominent criteria in conjunction with the T-line.

Watching for the end of a bounce in a down trending market. Today’s lower trading is confirming yesterday’s bearish Harami potential in the Dow. The other indexes are showing weakness. Keep both long and short positions in the portfolio.

Today’s initial selling in the market indexes do not indicate any major change of investor sentiment. The indexes continue to trade above the T line and the 3T line is demonstrating some relevance. Be aware of individual stock/sectors performing well.

The Dow is showing strong confirmation of a reversal, indicating the T line is now not acting as resistance and it has broken the downtrending channel. All the other indexes are also trading back up above the T line. Anticipate more upside until there is a sell signal. However, remain nimble waiting to see whether the market indexes are producing a bullish bounce in a downtrend or starting a new uptrend.

The Dow is producing the strongest bullish reversal prospects PROVIDED the Dow closes near the high end of the trading range. The other indexes are trading positive but below the T line. Be prepared for a reversal but give it to the end of the day.