May 7th Daily Market Comments

The belt hold signals of yesterday needed to see a flat or positive open in the markets Today. The lower open obviously illustrated the Bulls had not yet taken control by getting the indexes back above the T-line. Currently, the Dow is trading back to the 50 day moving average. The other indexes, trading lower, indicate a consolidation in the markets is still in progress. It will be important to watch the Dow at the 50 day moving average to see if it’s going to act as support again. Although the current downtrend is in progress, numerous stocks are still holding up and trading positive, indicating there is not a full-scale bailout occurring in the markets. These market conditions warrant having both long and short positions in the portfolio.