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Muddy and Choppy pretty well describes the short-term in the 500. Recent rally wasn’t that big of deal and todays roughly 1% decline hasn’t broken any key support.
Game Plan….Per the long exposure in the equity market, remain heavy into the high yield funds and PFF. As I shared in the chart above, if support line (3) is taken out, being defensive most likely won’t be a bad idea.
Pre-market this morning (see post here) I shared that the Dollar, for the first time in months has broken above its falling channel. If history is any guide, an upside movement/breakout will create price challenges to commodities and most stock markets.
With the Dollar breaking a steep falling channel, should the broad market break support dating back to the 2009 lows, even slow money (401k’s) should be very cautious!!!