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Dear Toolbox Readers,

The market is sending mixed signals this week. Most of you that have been with us for a while will know that we like to keep and eye on the BPNDX as an indicator of changing market trends.

Normally we like to call a "buy signal" when we see a white candle appear under 30. This has always been a good indicator for longer term investors. But this time we see one forming lower than we have ever seen before.

As you can see the last white candle under 30 the DOW was at 10,700 or so and immediately ran up to about 12,600 when we saw the first red candle over 70 (our sell signal). We called the sell at the time and it seemed like we got faked out.

The market continued higher although in a sideways kind of pattern and we got a few more red candles over 70. You will notice a red candle over 70 just before the peak last October. That is when the wheels came off and the market tanked.

Now we get the white candle but for some reason I am not buying it. Oh sure we are short-term oversold but look at the next chart and you'll see the "dome top" rolling over on the S&P500.

The last time that happened we saw a huge move to the downside and given the current circumstances in the financial sector I am not ruling anything out.

We will watch this market closely and let you know when we think it actually breaks one way or the other. In the short-term I would expect a rally or a bounce, but then there may be much more risk to the downside if the economy and sentiment do not pick up.

Earnings season should keep some "happy news" hitting the street and could actually prop things up for a while.

The Two Greatest Days Ever... So Far.

As you may know we recently launched the Research Lab for our readers and one of the most important things that you need to understand is that inside the lab we look at things differently.

We look at "today's action" from the open... not the previous close. Does this make a difference...you bet it does.

Look at the chart below...

Wall street and the main stream media would have you believe that this was a terrible week in the market. Not True!

This week on Tuesday and Wednesday we had two of the most spectacular days yet in the research lab.

On Tuesday there were some picks up 50-70% in just one day, and 20 picks up more than 10%. Then on Wednesday same thing again only 48 stocks were up more than 10%.

This all happened while they told you all hell was breaking loose. This is all due to the way they look at the "day".

Just one more reason it's better to get your intra day looks from us rather than other financial portals...

How to Hedge Your Bet On Access...

Did you get "locked out" of your trading this week? Many people did. Platforms like Ameritrade and TradeStation had severe difficulties keeping up with an "active" market.

This was not good news if you were long last weekend and watch world markets roll over during the holiday.

Bill had a great idea and that was to keep a separate account open someplace else so that you might be able to log in there and bet the other way to keep yourself flush until you get your access back.

This is great advice if you are the kind of trader that DEPENDS on access to trading platforms.

This my friends is the "price" that you pay for the ability to sit at home and trade your way to riches each day. This technology is great, but when you're locked out it is infuriating.

Having a way to at least "cover" your butt by betting the other way in a different platform is great peace of mind and... you'll never know when you'll need it.

Finally...

If you have not done so already...

Download the Desktop Toolbox Today &

Become A Member of The Research Lab

Until Next Time...

Best Wishes and Good Investing,
Bill McKinley & Doug Newberry
The Investing Systems Network

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