Tuesday, October 23, 2012
Market indices took a big tumble today. For such a huge drop in the indices the breadth numbers that I track was extremely low. Having said that the Market was also rallying on extremely low breadth. All of the leading stocks are now hit hard and would take time to setup. Any bounce is an opportunity to sell short. Looks like more pain before a gain. At this time remaining in cash is the best bet!
Monday, October 22, 2012
Markets chopped around for an hour from the open, then sold off and then staged a recovery towards the end of the day. After being hammered on friday, the next logical move for the markets was a bounce and indeed the bounce happened. AAPL is said to announce a new product tomorrow, perhaps a mini IPAD to take on Amazon and other companies making cheaper tablet. AAPL was a big mover up almost 4% today
Markets were hammered and sold off on Friday's session. The Market action for several days prior to Friday offered many clues as to why a trader or an investor should stay away from the Markets and remain in cash. Breadth numbers were relatively high on the sell off when compared to prior days. As of now, remain in cash. If you are an experienced trader shorting opportunities are abound on any bounce.
Thursday, October 18, 2012
SPY having gone up 3 days in a row, showed stalling action. Nasdaq and Russel 2000 indices were already under performing SP-500 and both indices took a hit today. Interesting day today as GOOG earnings were prematurely released around noon. Trading on GOOG was halted for about 3 hours. In the end the earnings report did not go well with GOOG and the stock paid the price. Many leading stocks are being smacked. It appears the market is not healthy enough to reward stock buyers on the long side. If you look at 3 month performance, Financials have been clear leaders. But, how long can the financials hold the Market up. Look at the charts of AAPL, GOOG, CMG, PCLN, AMZN, ALGN, MLNX to name a few which tells you something i.e MOVE TO CASH!!!
Wednesday, October 17, 2012
Monday's rally extended to tuesday as well. All of the indexes bounced from support levels and are quickly approaching resistance at prior highs. Breadth was lacking in the bounce. Watching price action one day at time will reward you over the long run than anticipating which way the Markets would go.
Monday, October 15, 2012
Markets bounce back monday from a depressive week of sell offs. Many leading stocks were rebounding from oversold levels. However, the big picture is still bearish. AAPL was almost down 12% from it's recent highs and the stock bounced back. GOOG is down about 5%. One day doesn't tell if any rally is in the making. However, the sell off is contained as of now.
Wednesday, October 10, 2012
Markets went down without putting up a fight Wednesday. Dow down 3 consecutive days. Nasdaq and SPX are down 4 days in a row. Indexes are approaching oversold levels. However, there may be more downside before any sort of bounce develop. IBD's market pulse has switched to 'Market in Correction' due to multiple high volume distribution days in the indexes for the last few weeks. The damage has been done. If you are still holding stocks, sell into any bounce and raise cash. An experienced trader would hedge his or her position with options or play the markets on the short side patiently waiting for an opportune time. Always stick to your trading plan, accept you will encounter losses. The goal is to keep the loses to a minimum.
Monday, October 08, 2012
Once again Gap ups are being sold. Friday's session was another example. Markets unable to gain any traction at this time. At the same time there isn't much selling either. Still a sideways market which is a where you would lose a lot of money trying to trade aggressively. Staying in cash is a wise thing to do.
Thursday, October 04, 2012
Market indexes broke to the upside led by financials and break down in bonds. As usual breadth was missing. But lack of breadth has been the characteristic of this market either up or down. Market momentum I track is pointing to more upside. As long as there is music we dance!
Monday, October 01, 2012
Markets are choppy after making a new high on sep 14. Gap ups and any bounce is being sold. To me there is underlying distribution taking place. Markets need to push ahead with large number of stocks participating in the move for a rally to sustain. At this point taking a short position may have a better probability of success than a long position. It's only during sideways choppy action people try to over trade and lose money. Cash is also a position. Wait patiently for the market to setup.