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MARKET WRAP UP 10/20/10
The film Memento (2000) centers around a man who suffers short-term memory loss, and must wake up every morning more or less starting from scratch in his quest to uncover the identity of the man who he thinks murdered his wife. With the stock market selling off aggressively yesterday, followed by today’s equally powerful move higher, one has to wonder whether Mr. Market is facing a similar predicament to Guy Pearce’s character in the film. Indeed, the past two days of market action have not been momentum trading at all, but rather “Memento trading” (or “memo,” for short), with yesterday’s concerns being thrown to the wind along with caution today.
Although it may not be very sexy, I believe that it was equally correct for swing traders to adopt a more neutral stance yesterday as it was to maintain it today. I continue to hold many bullish bets that I believe are sound setups, but I am more apt to now take a pass on upping my long exposure. Despite the S&P 500 closing up 1.05% to 1178, I will wait for the S&P and Nasdaq Composite Index, as their updated daily charts illustrate below, to recapture their respective support trendlines before allocating capital to the long side without reserve.
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Mr. Market felt tired today. At least to me. Being cautious about new positions and watching the stops.
Keep bringing these great blogs to all of us. Always informative AND entertaining.
Regards,
Judy G
The market is in search for John G and I guess that makes you…. Teddy? Lol nice post and congrats on your new venture with RC.
Neutrality? I’ve been neutral and long cash for so damn long that I got bored today and jumped back into the dry shipping lotto with EGLE. Talk about sick, that 400lb Greek gorilla had me naked and bent over a wine barrel last year and dipshit that I am I went back. My memory must be the second shortest thing on me. Fly’s right 47-1/2 should be the age limit on iBC, I’m 147-1/2 today. Maybe I’ll stick to running my business for a while.
Damn – got the spam Q wrong again!#*%#$