Great post ⬇️. I was pretty loud for weeks that buying the strongest names into momentum was the easiest money which is not how I typically trade. But I adjusted so I could participate. The thread below provided the evidence that the market now has shifted so chasing higher no longer makes sense to me. I am still a buyer but back to waiting for my levels.
Signs The Market May Be Entering a Risk-Off Phase, Consolidation, or Losing Momentum:
1) Leadership Breakdown & Weakening Participation
Leading sectors start to break down, and the top-performing stocks that were driving the rally begin showing relative weakness.
2) Failed breakouts
High-quality setups are no longer following through, often reversing quickly after breaking out.
3) Stalling at Key Levels
The market struggles at resistance or key moving averages and begins to roll over from those areas.
4) Heavy Volume Selling
Sharp down days accompanied by high volume suggest institutional distribution and caution.
5) Watchlist Deterioration
Fewer actionable setups. Many names lose structure or momentum and have to be removed from the watchlist.