Trapping Longs

Drawn into the stream
Of undefined illusion
Those diamond dreams
They can't disguise the truth
--Level 42

After yesterday's lift seemed to ease bull psyches about recent price weakness, the hammer came down today. The SPX was off 1.6%, erasing all of yesterday's gains and then some, and easily slicing thru the 50 day moving average.

In addition to the usual suspect list of catalysts, there was some chatter that there was heavy futures selling out of Europe today, perhaps driven by the ECB. In any event, am getting the feeling that there are increasing numbers of 'trapped longs' looking to sell.

Pulling back the time horizon demonstrates just how high this market has gone and how far it has to fall before significant damage is done. The uptrend defined by the Thanksgiving 2012 lows is still in place, and can not seriously be viewed as broken unless/until the SPX falls another 60 or so handles thru 1900ish. This level corresponds to the 200 day moving average.

It does seem like the tone of the tape may be changing. However, until big technical support is breeched, Hoofy's Heros must be given benefit of the doubt.

position in SPX