A significant warning has developed over the last 3-4 days and the market responds with a waterfall decline.
Risk is VERY high. Reduce your exposure to risk accordingly.
Expect large movements in either direction and for the market to continue selling into any recovery advances until a final low in this phase is observed.
Watch for stabilisation in price and in the oscillators as the market resolves the perceived problem with price relative to itself.
The Buy Signal line will gradually drop and we will look for a close above that level to confirm that a recovery is under way.
For now, the market is in a strongly bearish trend, with yesterday's move signalling further weakness and establishing a weekly downtrend.
If the market attempts to recover, watch for failure of advances to occur for short entry as traders who did not sell yesterday look for higher prices to cash out.
Be prepared for whatever is coming next, and trade with confidence:
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Disclaimer: This is the diary of a personal trading system, its methodology and the signals that it is producing. You are welcome to follow along but please understand that the information presented here is for educational purposes only. No recommendations are being made to buy, or sell stocks, options or futures contracts. Please consult your own financial advisor before making any investment decisions.