Friday, July 2, 2010
Bullish Non-Confirmation in Place
Although I know I'm a fool for trying to call short term bottoms when a big wave 3 is probably underway, but I like to keep profits when I get them. And exiting some or all my positions now is fine when I can simply just add them back on when the S&P makes a new low. The market is oversold on the daily charts and momentum lower has been weakening as discussed yesterday. Now the Dow and S&P have both made 5 wave declines today, but the big problem is that the Dow made a new low and the S&P has not. This again shows a weakening of the downtrend as not all indices are even able to make new lows together. I would be cautious here if I was an aggressive bear, and if anything I would keep that caution on unless the S&P and the Nasdaqs confirm the Dow's new low. If that occurs then I'd simply put my shorts back on. So I'd only be missing a few S&P points of profit to perhaps save myself from a possible huge rally into the close, or early next week. So the risk of missing profits is small and the potential to safe already existing profits is great. Again, if the S&P and Nasdaqs make new lows to confirm the Dow's new low, I'd simply put my short positions back on.
Just a thought.
PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.