The Nasdaq outperformed the broader market for a change, yet it still closed down for the day. I think that you could see the tracks of technically based traders once again as the Nasdaq tagged its 200-day moving average and turned on a dime. The buyers have done a good job of defending the Nasdaq’s January lows over the last few days and the chart really looks primed for a bounce. But despite the apparent bounce I’m not moved to put any money to work right here. Like Stephen said, there’s not much to do right now. If the 200-day moving average wasn’t so nearby I’d be looking to short the Nasdaq if and when it bounces. But with the 50-day moving average dropping so fast the risk/reward won’t be very good. In other words, I almost see those converging moving averages like two sides of a triangle. And just like with a triangle, I want to wait for one of those sides to be broken before initiating a position.
