1.Since I wrote on Chipotle $CMG as a short idea last week nothing has changed my mind. In fact, my conviction has risen. Why? Jim Cramer is going to fight staying long all the way down. Second, during my daily reading, an article written by a restaurant industry expert nailed some of my thinking on Chipotle and went even further. Here is the link, http://bit.ly/1TAqJ34.
2.Today the Russell 2000 $IWM failed at its 61.80% retracement (1104.97) after moving above it last week. A week ago it was noted that this needed to become support. Unfortunately, it is now resistance again.
3.On March 24th, I noted that the Heikin Ashi Candle Stick had turned negative on $SPY. This negative trend lasted three sessions before turning green again last Tuesday through yesterday. Today it is back to red. This situation is troubling with the flip flopping between red and green.
4.The world has gotten normal again in the last couple of weeks where the shorts are falling and the longs climbing. The long/short tsunami is over for now. Worst case the spread between longs and shorts is minimal.
5,On March 10th, we wrote about an epic garbage rally in the energy patch $XLE $XES. That has played itself out and one can make more again shorting energy names as the price of crude starts to fall again.
6.My QPI Overbought/Oversold indicator is neutral right now so there is no advantage to the bulls or bears. That said, a sell signal was issue on Monday. Another weak day with a drop of 20 S&P points could see a new buy signal emerge.
7.Last my Advance/Decline Line Model peaked out on March 14th close and has gone from invested to cash. The model made a change that took us to cash earlier than expected at 2037.05. Currently, we are only 8 points away from that level.
As markets reach oversold status again, then prepare your shopping list and take advantage of the rise in volatility. Markets are starting to deteriorate and we need to pay attention to the increasing noise.
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