Tuesday, February 24, 2009
By the way, we got a pretty good pop up in the markets today. It didn't close above this past Friday's open/high so that's what I'll be looking for...but today's action could just be a dead-cat bounce as well. Wait for confirmation before picking a side...
Monday, February 23, 2009
Sunday, February 22, 2009
Personally, I think we get a bounce from here:
1. The trading day on Friday (2/20/08) generated what's called a "bottoming tail hammer". It's a signal that a possible reversal is coming. Look for a close above Friday's opening price for further confirmation.
2. The MACD indicator barely shows some divergence. Meaning, the SPX (S&P 500) has gone lower on less momentum. 1/20/09 the MACD delta was at -9.15 and SPX closed at 805. 2/20/09 the MACD delta was at -6.34 and closed at 770.05.
3. The Stochastic indicator is WAY WAY WAY oversold indicating that a pull-up in the markets could be soon (I don't personally put a lot of weight on this indicator).
But here's what's important...I could be dead wrong! And I'm ok with that; the point is that I believe there's a low risk entry here to go 'long', because if I'm wrong, I'll lose very little.
Never FOCUS on how much you can make with a trade; FOCUS first on how much you could lose!