Here We Go Again...

The DJIA and the rest of indices plunge once again. So what else is new? They say that the trend is your friend and that you must follow it. Looking at the current market trend, we should all be cautious and perhaps, stand on the sidelines. Many were calling bottoms and oversold conditions but one must remember that the market moves in its own rhythm and speed. Look at PDO for instance. How many times were people calling tops on PDO as it pushed itself higher and higher. It was moving in its own rhythm and speed, which at the time, was unlike any other stock and index (besides MXC). So maybe the indices are facing higher downside pressure than before. Perhaps it will take a bit more of a drop to place an oversold condition. We maybe getting close. Fear is starting to rise and spread all over Wall Street. Just look at the VIX. The VIX just touched over 30 today. It took another 200+ point drop to get here. If we see a clear reversal of this down move, then we may be ripe for an oversold bounce. If the VIX stays near its high and the indices stay at their lows by the end of the day, then watch out tomorrow and perhaps the rest of the week.