Change in Market Character? Posted by Coolhand

So, the first trading day of the year starts us out on a negative note. That's not a good sign at face value and could be a problem if there is follow through.

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The S&P gave up most of it's past week gains, but it did close well of the lows of the day. But that candlestick isn't pretty. The DWCPF continued to give up gains, now closing negative for 5 out of the past 6 trading days. Momentum is falling on the DWCPF.

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Cumulative breadth remains bullish, but it was negative today and is no longer ascending at the rate it did for all of November into early December.

We did see NAAIM rein in their bullishness to some extent the past 2 weeks. It is important to remember though, that they were still positioned in a moderately bullish stance. However, they can change their sentiment whenever they want as they are certainly not held to the sentiment they reported on any given Thursday. As I said last week, they may have tempered their bullishness because they are waiting to see if anything changes as we end one year and start another. And something "may" be changing.

Futures are positive right now (Monday evening), but that doesn't mean much of anything other than perhaps there is no panic selling. Still, I think it would be prudent to reduce risk for the time being until the market makes a bolder statement one way or the other.

I am going from bullish to neutral.