Saturday, January 23, 2010

A Correction is Underway

Since March 2009 lows, SPX has corrected twice, dropping 9.1% from its peak in July 2009 and 6.5% in November 2009.  This correction is no different from the previous two and I expect a drop of 7.8% (average of the last two) from the recent SPX peak of 1150.   That suggests 1061 as the low point for this correction, very likely happening intraday either on Monday or Tuesday next week.

I looked at currently top ranked stocks, none of them looked that good to me.  My plan is to buy the indices once and if SPX  hits 1061 or lower.  I'm going to use "conditional market buy orders" to open these long positions:

SPY 20%, QQQQ 40%, IWM 40%

Good Luck.

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