The line in the sand...
With every new extreme declining day it always seems to flush out the traders calling for the next market top. We've come to notice that there are a lot of traders in the business of calling tops even if they must repeat for weeks or months until they are right. What we tend to tell traders is to stick to what the charts tell you. There is a lot less panic and uncertainty when you listen to what the charts have to say.
How can one easily tell if a market or stock is in an upward or downward trend? Well if the market is in an uptrend we will see a series of higher-highs and higher-lows. If the market is in a downtrend we will see a series of lower-highs and lower-lows. These are pretty easy to see and map out.
Let's take a look at the mother of all charts, the S&P 500.