Investors are a silly bunch, there are those who believe that they will NEVER be able to beat the markets. Then there are those who have exhausted their fundamentals analysis and still cannot beat the markets. Then there are the technical guys, same result. But the worst kind of investors are those who pooh-pooh everything that does not fall into their line of thinking, or that they must know why they make money or lose money, and would never bother to give this "fantastic fengshui chart" a try.
Whatever works man, whatever works is my friend ... investing is an inexact and fluid science.
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The recent recovery in the stock markets was to be expected as market participants were waiting to buy,waiting for the long overdue correction,that never come which finally did.
This recent market rally has let market participants grow more encourage,braver and into more widespread complacency.They widely believed that another all time highs is in the waiting.Which will be another all time highs,if it ever gets there.As I have said recently I will be looking for the next rally to get short.
This coming rally,if there is one will be the final rally,and is and will most likely be the distributing phrase.Shorts or rather bears as we would like to call them,have finally turn net long the S&P futures.As they have just recently turn positive net long,pure common sense tells us,this means that the markets will have more room to go higher.
A few weeks or months more,only 'Mr Market' knows.One thing I do know a dozen pts above all time highs and I will be gradually getting in bit by bit,maybe to fill only one full position which is 8 contracts,to allow wider stops to withstand a final market spike up.
Our lond Usd/Cad is up about 40 pips.I will be adding on more later on.First we have to wait and see where the greenback is going.As the stock markets are rallying,risk on is never good for the greenback.The European currencies are doing good and so are the commodity currencies.Trendline support for Usd/Cad is around 1.08,so my stops is at 1.0750.
If our horse is still running and forget to stop after passing the wire(1.0225) on a daily close,do expect 1.16-1.20 in the next few weeks or months.And not to forget,the year of the 'wooden horse' is always good for the horses.And the continious posting of beautiful and sexy babes,who knows?
"Whatever works man, whatever works is my friend ... investing is an inexact and fluid science" - so very true!
In trading,sometimes we have to keep a lookout for the elephant's footprints.For the last nine months the small and large specs were net short the S&P futures.
Suddenly the most recent CFTC traders commitment has the specs net long.Since the public is net long,who is doing the selling? Of course it is the commercials who is doing the selling.
But because the commercials are doing the selling now,does it mean that the markets are going to tank tomorrow,next week or next month?No,the markets are only going to tank when the buying power has exausted and the last buyer has bought.When will that happen?Go do your own homework and figure it out yourself.Because if I knew,I would be living in beautiful hilltop mansions overlooking the beautiful sea.
One thing as traders we have to remember and never forget.The commercials are never wrong at major market turns.Why?Because it is their job to be sellers at the very top and buyers at the very bottom.
I will most probably continue to be fully invested this year. I'm confident that most of my counters would be able to ride out the next inevitable down cycle. I'll be hoping that the upcoming bbear market - would be sharp, short & then followed by a steady uptrend that span for at least 8years.
This current bull market is in its fifth year & we should...
I will not try to outsmart markets by timing trend reversals. Make hay while the sun still shines. Or, one may have to wait very long for the dawn of the next uptrend!
Well,I would actually be very surprise if the markets do not enter correction territory of more than 10%-20% by the second half of this year.In fact I will be expecting it to happen sometime in March or April.
And my bias is that the markets will enter bear market territory sometime June-September period.This will be a long grinding bear market,lasting years and years.
Anybody who thinks that it will be a sharp correction followed by a steady rally to higher highs for the next 3/4 dozen years, better put on their thinking caps.I have said before,I will not be surprise to see the Dow at 5k or even 3k in the next few years.
When bulls have very high expectations of the markets,sheer complacency kicks in.Over
confidence of traders,investors and speculators,with the 'when the last buyer has bought' becomes a self fulfilling prophecy will make the market's recent retracement looks like a minnow swimming in a pond of koi.
Trading can be a very profitable business if one can keep his ego in place.To me being right or wrong is of no importance to me.Survival and frofits is the name of the game.Up to date,based on a single contract of 100k,with a margin of 3k on a single contract,we had 650 pips or 6.5k profit.That is more than 200% profits for being wrong most of the time.Just imagine,what if we had being right most of the time,like the professor with his trend investing?
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