Ok, So Bar 13 Is In. What Now?

There is no denying that we had another strongly bullish day and another up trending price bar on the daily chart of the cash S&P500. But it was also bar #13 in the TD Sequential Countdown process! If one were to entertain the notion of selling into strength here, the first point to note is the stop level at 1121.95. With that rather wide stop in mind, the most aggressive move is to act on the fact that bar thirteen is in. The most conservative action is to await confirmation of a sell-off using the level of 1046.50. If the market is set to turn down I would expect the high to come in no later than today. Anything later than that and the Level 1 price pulses will be showing the trend as up.

Another way to watch this action is through the Dollar Index. It has been moving inverse to the s&p’s since March and just made its own Sequential bar #13 countdown for a buy signal yesterday. There is also a fairly wide stop for this market too however (74.1), so it is important to not jump the gun on a trend change.

Bottom Line: I have been short-term neutral since October 9th and remain that way now while waiting for more definitive proof that a top is in before acting on the new sequential signal.