Pardon me for my lack of posting today, as I have been away from my desk most of the day taking care of errands that I have been putting off for quite some time.
As for the market, today’s selloff just goes to show that the market will usually do that which frustrates the majority of traders. The news yesterday would seem to have erased the uncertainty in the market, but clearly that is not the case today. Either way, we are still in an oscillating market, and not a trending one. To me, that means you should be in heavy cash.
As demoralizing as today may seem for the bulls, keep in mind we still have the potential to make a higher low. I have been looking for a pullback from the sharp move from 1010-1100 over the past few weeks. Now that we have it, will the bulls step up to the plate? It sure does make for fine summer entertainment. However, just like the other summer entertainment, Shakespeare in the Park in New York City, you should not be spending any money on it just yet.
For me, my line in the sand is the 1050 area. Should be blow through there, I will go back to 100% cash and look at the short side more seriously for swing trades.
Thanks for your thoughts Chess- Enjoy the weekend
Thanks Bern–you too buddy.
you made a very good point yesterday, Chess. GS news is what screwed me up today. Anyway, it’s a battle everyday. keep up the good work.
Thanks sg.
Yup — I think lots of people were caught long this morning, which might explain the vicious selloff.
Also — even if we seem to make a higher low, it’s not exactly an all clear. We could start churning, or even better…. form a wedge of some sort and then break back down.
It is not a slam dunk, but it is necessary (but not entirely sufficient) for the bulls.
Indeud
Great commentary as always, thanks.
Thanks Jeff.
Funny how people were so eager to buy stocks yesterday after an overextended bear market rally.
With a declining 50 day MA and trading below the flattening 200 day MA it was pure suicide.
Oh well, I guess I can’t always be on the winning side of the trade. I live to trade another day. Looks like this might actually be setting us up for a much more prolonged up move if that higher low does get put in. We shall know that in the fullness of time.