Today was another one for the bears. Living in Chicago this is usually a good thing, but when we speak about the stock market it’s a completely different story. The question on everyone’s mind now is where do we go from here?

If you spent anytime today listening to the analysts you most likely had a pit in your stomach the size of a grapefruit. Chicken Little thought the sky was falling, and he looks like the optimist of the year prize recipient. Throughout the last few weeks each time a level on the S & P 500 was broken on the downside, they replaced it with another level. Unfortunately, there doesn’t seem to be a good level of support these days. I guess these support levels will eventually become resistance, but the question is when.

The markets are currently moving hand in hand with that of the euro. What concerned us today was that the euro rallied, but stocks didn’t follow. Investors were fleeing equities and commodities faster than leaving a burning building. Once again, where is the investor to posture themselves? If you go completely to cash, you will probably look good in the short run. Most likely these markets will continue to sell-off in the near term. History has show though a majority of investors cannot pick bottoms and will most likely wait until levels are well above today’s to re-enter. It’s proven to be true. Your other option would be treasuries. Although yields are low, you know you have complete safety. The problem once again is you may miss out on the future rally on stocks. Even if you don’t, you still carry risk since there is definitely a potential treasury bubble.

This is the time that separates the men from the boys. Nobody has the ability to predict the bottom of the market, but you do have the ability to recognize sale prices when you see them. Be diligent on your choices, and do your homework.

Trade idea for the Day

Stocks 5.20

Radiant Systems, (RADS). We’ve been following this position for a while waiting for a proper pullback for entry.  This stock has extremely strong technical formations, coupled with decisive momentum. It sold off 5% with the overall market today and we made our entry at $14.88. We put a short-term price target on it at $16.40.