We've had a few days of selling in the past week. Distribution days are 7 on the NASDAQ and 2 on the S&P500. So, is it time to bail out and go to cash?
Our thought this morning is, no.
Bullishness readings had gotten very high and that is a contrary indicator-- when everybody is a bull, sell. That was probably spurring some of the selling coupled with an unease about the Senate being able to pass tax reform as meaningful as that which will pass the House today.
Late in the trading day Wednesday fear levels, as measured by the VIX and Put/Call ratio, spiked. Sounds bad but, again, it's a contrary indicator.
Futures this morning are up. If the market closes solidly up today we'll stay at 100%.
If it falters badly we'll be looking to move a small percentage to cash.
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