Wednesday, November 28, 2012

Markets holding ground

The day's action started with a gap down and for a moment looked like the markets were headed down.  Buy programs kicked in at the hour from the opening and the markets built on the momentum.  It is important to watch the price action and not assume or predict the direction of the markets.  Betting against the market is a loser's game.  It is not about whether you are right or wrong on the market direction.  It is all about how quickly you change your opinion if you are proved wrong.  Bottom line, markets appear to be choppy but are holding their ground.

Monday, November 26, 2012

Sharp Counter Trend Bounce

I haven't able to post my comments last couple of weeks on the Markets due other commitments post Sandy storm and due to thanksgiving holidays.  Here is my take on the Markets.  Markets have made sharp recovery last week after going down 10% plus from september highs.  Last week was a holiday shortened week.  Nevertheless there were some eager buyers bidding up the Market.  As usual breadth was lacking on the upside move.  Today's action was encouraging in that the Markets held on to their gains.  In the last 5 days the Markets have regained half the losses from september highs.  It remains to be seen how it performs over the course of next couple of days.  The downtrend is in effect until the 143-144 zone is taken out on the SPY.  Until proven otherwise I would consider this action a counter trend bounce and will be on the look out for shorting opportunities.

Tuesday, November 13, 2012

No respite on selling

Markets continue to sell off.  No respite on selling.  What is disturbing though is that the breadth numbers I track are not at extreme territory despite  the sell off.  This means there is more room to downside.  Short positions have continued to work well.  We are in a zone where a bounce could materialize.  But watch the price action of the Markets and do not make any assumption.  The market is in correction and it needs to be played out.  Patience is key.

Wednesday, November 07, 2012

Post Election Verdict of the Markets

The Markets have spoken.  The verdict is clear post US election.  Stocks sold off big time.  Today's sell off should not come as a surprise.  Prior to this day, several leading stocks like AAPL and GOOG were under distribution, markets made new highs on low breadth and was trading choppily and were in correction mode for the last couple of weeks.  If you heeded my advice you would have moved to cash or in net short position a long time ago.  SP500 and Nasdaq down more than 6%, RUT down 7% plus, It is going to take time for this market to settle down and provide any buying opportunity.  Having sold off big time, the next logical move for this market is a bounce which should provide very good shorting opportunities.