The past two days notwithstanding, I believe we are at the start of a lengthy bear market in equities. We certainly have not received "the big break" yet, but I offer these three charts.
First is the Russell 2000 accompanied by the advance/decline summation. It’s quite plain that the market as a whole has been eroding for months.
Strip away all the price bars and drawn objects, and replace it instead with the standard trio of exponential moving averages (50/100/200). It speaks for itself.
And over in NASDAQ-land, which was particularly strong lately, we likewise see the cross-under taking place.
Obviously I would have greatly preferred a bone-chilling washout on Fed day (Wednesday), but instead it exploded higher. I retain a 15% cash position and will be all too eager to deploy when the prices are right.
I would say also that my real estate fund iShares U.S. Real Estate ETF (NYSE:IYR) is my high conviction trade. This thing whipped around like mad yesterday, but I’ve got nearly 100 days left on this, and it’s $8 in the money, so I’m not sweating it.
Oh, and just one more—INDU………..
