The market has had a good run for the last couple of months. However, this is the single largest pullback in a day that I have seen for quite some time. To me this implies posssibly a short-term top is coming, but one can never be sure. So, I am playing the market accordingly: I am not adding to shares of UPRO (S&P 500) even though it is at the 20 day moving average (bullish). We are already overweight in that position. I would rather be a buyer of UPRO at 100 (it is currently at 105). Should stocks in the Dow Jones and S&P 500 fall another 2-3%, we will get more aggressive with our 50% cash position.
UPRO (S&P 500) on the 20 day moving average. Good support area but would rather size in around 100 and 95 (the 50 day moving average).
