iBankCoin
Joined Jan 1, 1970
1,010 Blog Posts

we can still go either way, with this oversold, so be nimble and let the market tell you what to do

Hi all,

The PPT hybrid oversold signal does provide for a great opportunity to trade a 1-2 day bounce, and we just saw that, and profited from it. Typically letting the oversold swings run longer is a great way to make even MORE money, however, if the market happens to be overly spooked, after a tepid bounce, we can see another leg down, to another oversold. This is exactly what happened in Aug of last year (current situation in the small PiP):

I got into TNA at the first oversold, didn’t take profit on the bounce, saw that profit disappear into a sea of red, and I didn’t have the balls to add more at the bottom. In the end I made money on the original O/S purchase ┬ásince the market recovered nicely, but the lesson here is: taking some profit on the first bounce, and getting out at flat for the rest would have been a winning strategy, allowing me to add without fear on the second O/S.

It is far too early to tell what the current action is telling us. The Bulls, as @chessNwine keeps telling us in his excellent market recaps, are doing an impressive job of keeping the market afloat. The bears, however, are doing an equally impressive job of keeping resistance down trend lines impassable, on most of the major indices. That, unfortunately, has the side effect of, by default, giving us a continued series of lower highs.

Please respect that. I am doing dip buying, but on intra-day basis (like with another TNA buy today) – not planning on putting on any swings (long or short) until we see more conviction from either the bulls or the bears.

My vague, personal feeling (from a newbie, so it’s worth what you paid to read this blog post) is that we’ll go lower before we go higher.

Update: I saw my $TNA buy go +$1, then start to retreat, so I sold out with a profit of just under $100.  Just keeping the day trading impulse happy, while the rest is patiently waiting for an indication of which way we might go, market direction wise.

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