What a way to start the week after the quadruple witching options expiration. The DJI finished off more than 200 points, the SP500 closed down more than 28 points, and the Nasdaq 100 loss almost 45 points. Advance/decline was in favor of the declines by more than 7:1 in the NYSE, and over 5:1 in the Nasdaq. The up/down volume was also in favor of the downside by over 14:1 in the NYSE and slightly under 9:1 in the Nasdaq. Based on these stats, the market was definitely being sold off today. There are people claiming this is simply profit taking to lock in Q2 profits, and others are saying this is the start of a correction.
Whatever the reason it might be, I am watching those key levels (see charts) to be breached before I draw any conclusion on the direction of the market. Until then, I will remain cautious and leaning more toward neutral. When it is unclear, the best position to take is no position. Trade cautiously until things are clear.
