The downward pressure on the stock market continued today as investors reacted to Goldman Sachs' downgrade of the commodities and oil sectors. While the longer term trend remains to the upside, the near term picture has gotten worse.
Oil and materials stocks led the whole market lower. When markets correct, correlations go up and diversification offers little protection. As a consequence I continued to reduce our equity exposure.
After the fourth day of decline the market is due for a bounce. Yet , our indicators are telling us that the big players are in sell mode. It is generally best not to trade against the big institutions. For the moment we will keep a defensive posture.