[chart courtesy of marketwatch.com]
Yesterday, we saw a repeat of sizzle and fizzle in the market as a solid rebound rally had the Dow up by some 125 points and back over the 10,000 level.
As has been the case more often than not lately, the activity during last trading hour took the starch right out of the momentum and down we went with the major indexes closing in negative territory. This was certainly a disappointing outcome for those hoping that we may have turned the bearish corner two days ago.
Even the cautious but upbeat comments by Fed chairman Bernanke could not support the waning momentum. External news from the European Union and general uneasiness about the global economy seemed to be simply too strong to overcome the meager internal reports from the beige book and consumer and business spending.
Our domestic Trend Tracking Index (TTI) reversed course from the prior day and moved closer to its long term trend line. As of yesterday, it still hovers +0.21% “above” it keeping us in bullish territory.
Barring a sudden grand solution to all what ails the global economies, it’s just a matter of time before the domestic TTI breaks below its line.
Once it does, we will become outright bearish. Since we are so close to that point, I will keep you posted on a daily basis, as I have been, via this blog as many readers have indicated that this break will be their ultimate indicator to get out of all domestic equity positions.