Market Roundup | stockbee

1/21/2008

Market Roundup

Market Monitor: Bearish

  • It will be a tricky day on Tuesday after such a major carnage in the worldwide markets.
  • There will be some Fed reaction and possible emergency cut.
  • So it will be volatile session.
  • Because of Market Monitor being bearish for many weeks now, the only open positions are short positions, so it will not be a bad day for those following our methodology.
  • The entire objective of Market Monitor is to avoid such risky periods and only trade good periods on long side.
  • Existing shorts will do very well. But protecting open profits on them will be the key.
  • Many times the key thing during such time is holding on to nerves.
  • There will be lot of noise, I remember coming in to September 11 week I was heavily short and then when the market opened post many days of closure, there were all kinds of people on TV saying it is time to buy. Buffett was on CNBC saying he will be a buyer and so on. They were saying there will a patriotic rally and so on. What happened was market sold off hard for few days and then it rallied. Those who listened to all the CNBC bullshit and bought on first day were left holding the bag.
  • So unless you have to trade or know what you are doing, you should stay out .
  • Even if the market turns, it will not be one day rally, there will be many opportunities down the road.

3 comments:

Hector Rivera said...

Nicely stated, i 100% agree, the video of a guy losing 31K that took him 2 1/2 years to build, it took him 1 trade to lose in 1 day today in the futures and his reaction tells the story. Even that we have different methods, i arrived at the same conclusion. Im also in cash.

Trading Goddess said...

Hector,

I don't believe Mark, HPT, was diversified.

I believe he also stated on Friday was he was doing may be a "gamble".

Hector Rivera said...

Tg,

My point is this;
1. Violated stop loss
2. Gambling...instead of managing risk.