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Post Market Analysis, Thursday January 21: Bearish

|Includes: DIA, IWM, QQQ, SPDR S&P 500 Trust ETF (SPY), XLF

 Big sell off across the board today. The S&P 500 (NYSEARCA:SPY) broke down out of its rising wedge formation on the daily chart. The high base was shattered today, so a high base breakout is no longer a possibility. The break down occurred on very high volume which is significant in confirming the rising wedge break down. The VIX popped 20% today, closing over 22! A lot of fear is coming in to the markets at this point. The TRIN was very bearish while the TRIN/Q was oddly bullish. The TICK and TICK/Q were both bearish today.

Be very careful going long in this environment. I am personally going to wait for the next swing low before considering taking up any more long positions. Always compare stocks you are watching to the indexes to identify relative strength or weakness. Going short would be a better bet right now, but it is tough to say how far the sell off will go. Expect major support for SPY at the 108-110 area.

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Thanks for being a part of Swing-High.com! Always trade with a stop loss and manage your risk appropriately.

Happy Trading,

Jason