Decision Time

The CMI is still signalling a buy, but because I had been stopped out we are now at a crossroad. History of CMI indicates the smart move is to run a stop up to or near a 20% gain which is where the CMI is now. This would mean holding off getting back into the trade. In addition, the oversold condition of the market, and the gap between Wednesday and Thursday supports this decision.

On the other hand, the Nasdaq looks primed to run up to 1800 very quickly. This is not a move that I would want to miss. As I stated before, trusting the CMI will tend to lead to more profit as long as the 20% rule is kept in mind.

That being said, the plan of action, because I did not trust the CMI and am currently out of the trade, will be to watch the early market action and pick the path of least resistance. If up, I may jump in, if down, I'll pick my lower entry as soon as the gap fills. The more disciplined approach would be to sit tight and wait for a pull back due to the 20 % rule.

An ideal situation would be for a lower open on Monday that would fill the gap with light volume.
A false breakout to the upside could be just as possible...a painful reminder that chasing the price rarely works.