The SPY has printed seven consecutive green weekly candles for the first time since March of 2009. Moreover, as you can see in the chart below, the SPY is above its monthly upper Bollinger Band for the first time in nearly three and a half years. Both of those two facts scream “extended,” and “short-term correction is near.” At the same time, there are still plenty of enticing long setups. How do you reconcile this apparently contradictory evidence?
You forget about marriage. This is not the time to get married to any one stock and dig your heels in for the big buy and hold, even longer-term swing trade. Instead, if you want to stay involved on the long side, consider dating and having a bevy of one-night stands, via shorter-term swing trades for a few days. Despite the increasingly accepted conventional wisdom that POMO and Ben Bernanke cannot possibly let this market fall again, the game is the game. The more things seem to change, the more they stay the same. Try not to get lulled into thinking that you have a bunch of friendly angels at the Federal Reserve smiling over your shoulder, making sure that you perpetually make money on the long side.
___________
I’ve only been doing day trades and quick swing trades (max 3 days) since mid-December now, waiting for “The Correction”. It’ll be nice to Buy and Hold again for, say, a whole week. 🙂
Omar Little FTW!!! Baddest homo ever.
the game has changed chess, haven’t u heard, we’re doing capitalism without the losses now. even if the smart money starts selling the fed will just roll out QE~ and start buying stocks outright. the game has most definitely changed. of course this will work until it doesn’t but at that point it won’t matter anymore. until then buy all dips you dips 🙂
Thanks Chess. Also a fantastic clip – one of the best characters from my favorite show.