Market Monitor
- It was yet another volatile session, which ended on positive note.
- Market seems to be attempting to stabilize here. Such interim periods can provide good opportunities for swing traders. They also help set up good shorts.
- However overall the market continues to offer little for longer term traders and momentum based traders.
- If you go through the Market Monitor, I have color coded days for both 4% plus and 65 days during my free time. You will notice rallies have strings of green colored days with 4% down movers seldom exceeding 60 levels. Currently the down movers are still dominating.
- If market puts together 3-4 days of green action with 4% breakouts in excess of 200, then it might indicate end of the rapid selling phase.
- With a definite change in character and 65 days ratio still in bearish territory, I see no reason to be aggressive here on long side. There is high probability that the 4-5 days bounce here will fail and lead to more downside.
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4 comments:
Pradeep,
Many people are forced to invest in a few mutual funds in their 401K accounts - very limited choices. I guess this also applies to many employees overseas in their retirment accounts. What kind of strategy would you recommend in these cases? Like, how's the following:
# always invest in fund with best past 6 month rate of return
# after 10%+ correction use shorter 3 months performance as leadership changes after a corection
Thanks for your thoughts.
Joe
Hi Pradeep
I stumbled onto your blog recently and I feel really lucky, you are doing a great job! Keep up the good work and keep it coming...Thanks!
Quick question, what would you suggest as a good service for back testing? I tried the trial of Zacks Research Wizard, quite good, but it is too expensive for me - $1800 anually for 6 yrs data. Thanks again.
Joe
I believe in doing little trading in 401k.
But both your strategies look ok to me.
Much depends on the fund in specific plan.
Lazy Investor
Try Amibroker or Worden brother Blocks
Joe:
Almost all 401(K) plans have a money market-like vehicle. That would be the equivalent of being in cash, which imho is a prudent approach right now.
Good trading,
John
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