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Market Timing Signal - Down

By Jeff Pierce

2 Out of 3 of the markets I cover are now bearish for my market timing signal. The Dow flipped on Jan 24th and the Nasdaq on Jan 27th, wihile the TSX remains bullish. Caution is advised against opening new positions, especially if you trade momentum stocks as they can get hit the hardest. The last 4 times my timing signal turned bearish it was a strong buying opportunity. It's never easy to buy into selling but if you use discipline and target stocks that are being taken down with the overall markets and remain in bullish uptrends you could be rewarded.

All is not lost if you are a bull as even with the recent selling we're not that far off the highs and we really needed some sort of pullback as the markets were getting frothy. My twitter stream has few bulls left and the headlines on my news sites are starting to become downright ominous. It's not cause to hit the panic button yet, but it definitely is time to be sure your exit strategies are in place, especially if we get a weak market bounce.

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