I was hoping I was wrong. The market tipped over today finishing 29.27 points lower at 3172.36. Selling was strong. The previous assumption of short selling last Thursday did not hold true.
Yesterday, I mentioned that "the magnitude of the change can well upset the direction of this temporary bull". I hold this view. However, today's fall is what I will call, "in the 'OK' range". This approximately 1% loss probably will not turn the good sentiments around so soon and cause a steep ride to the bottom. However, the near-term support can be estimated at about 3000 points +/- 50.
Today's action can probably be attributed to profit taking from previous lows especially for those who took stock in march and missed the previous high earlier in the month.
As for a longer term outlook, we should not rule out the possibility that this is the early wave of an uptrend. I would suggest people to bargain hunt in the coming weeks when prices hit a cyclic low and go slightly longer on those purchases. I have the following reasons for this:
1) if it runs bull, you profit (of course!)
2) if the market ranges, you profit (much less but still no loss)
3) if the market continues to downturn (more holding power with a longer horizon)
The right stock pick and take your money far.
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