The way I see it we are at the bottom in a trading range that everybody has seen before. No real surprises left. Everybody knows more bad news is coming. We have heard so much bad news, that people are pretty numb to it. So, we need a spark to pop us up a bit. Less bad news, something signed by Obama, a good earnings report, a peace treaty in middle east. Anything will pop things up a bit. Even dropping down another 200 points may spark the short rally up. Its going to be like this for 6 months. Its a great trading range I think. Buy the dips, sell the tops. If you screw up and buy the top, it will come back again in a short amount of time. Just stick with quality stocks. Or just trade RIMM. Great earning even in the recetion and it sells down for an hour then pops back up. Hugely bullish. Most certainly will lead all the rallies. Investors are certainly frustrated, but this is trading paradise. Now is the time to practice trading skills where mistakes are fixed a couple hours or days later. Monday is a new week so we may get a relief rally if the super bowl is a great game. Or Asia that has been closed all week could have a huge sell off and help us go down that extra amount to spark the rally. I wish it was in the charts, but one way or the other we end up going up this week because it would take something totally new (like an assassination) to truly send us down a lot further. I could be wrong, but I think Im right.
Look at XLE, energy has a much bigger weight than the financials at this point. It's looking like it has a little more down to go before bouncing (I like using an 11,2 Bollinger band to quickly judge stuff like that). Also, XLF proved in early December it doesn't always bounce after a strong gap up.
that is a great way to look at what is going on. I have been making mistakes, im new! 1 and a half years later, after having taken 20 years off. but I get to redeem myself because of the range the mkt takes! The lessons arent clear though. The edge keeps changing and consequently i keep thinking my edge isnt an edge, my plan isnt a plan. any advice is appreciated.
If we were only halfway up or halfway down, then edges would be a big problem. Then trading discipline and small losses are vital to not going broke. But we are at the bottom. The downside is very limited for longs. They say we could see a low retest. But that is only 2 big down days away. And if it even gets that far, people are going to call it capitulation and pile in for an up rally. So the best advise is to play longs on the dips and sell them at the days highs. Look at a stocks behavior to get a rough idea what those highs could be. Also only trade with half your cash. This way on a big down day, you can buy more dips. Or you can practice the day traders tools and scalpe the momentums. The market is relatively forgiving right now as long as you stay biased to the long side. Its always more risky shorting a bottom but its pretty clear we will be down here for awhile. But to stress, nothing is absolutely certain so keep extra cash at hand.
I hate to be boring but we're probably stuck in a trading range for the next couple of months. It will be a traders market with the indexes hovering around their current levels.
Yup, my dad is an investor and he is very frustrated. He doesnt see the market going anywhere and good companies dont seem to rise above all this. I just trade and take profits daily and maybe soon he will see the light and do a little trading as well. You can only deal with what the market gives you so take it now, before the market takes it back away. Somebody will eventually invent a program that will do nothing but scalp the peaks off every rise. An instant money machine. The stock exchanges will run those to make money. That may change things to be a very difficult environment to trade in, so get the profits while the getting is good.
You need better reading comprehension skills. He said if it opens lower and stays down through the closing. Well it didn't stay down through the closing so the following part of his statement cannot be evaluated. But then you were the one who on Friday suggested a move down to 738.31 SPX, so I guess you were the one who is wrong again.