Weekly Update 03-08-2010:

The market did push higher last week past our noted Fibonacci level of 61% and actually reached past the 76% Fibonacci level where it may have achieved an intermediate “top” on Friday.  We now face the dilemma of market technicians of what do you do when you have been pressed to the outer limits of your stop loss and yet at the same time you are receiving increasingly strong SELL signals?  If at all possible you want to stay in your “short” position to take advantage of what seems to be an ever increasing probability of a near term downturn and yet also be responsible in respect to your “risk management” principals by not extending your loss limits.  The market is near-term extremely overbought and seems ripe for a reversal.  However, it is at these junctures that we have to “draw a line in the sand” on each day whereby if the market does start closing lower from here forward, we can retain our position, but any hint of it continuing higher, we need to exercise our “stop loss” and step aside for a re-entry at a later date.  So, if we see a possible reversal to the downside either today by closing or tomorrow, we may be rewarded with our “inverse” position, otherwise we will need to step aside to CASH and wait for another opportunity.  We will keep you posted.  Yours for Safe Sailing in Bull and Bear Markets.