Wow. This can't be healthy for the market. I have been watching the major indices swinging around from positive and negative territory like a vicious tug of war between bulls & bears for the past two weeks. I am trying to “stay alive” right now by staying in cash until a true entry point develops. The moves today from -400 to + 400 is completely noise on the charts so it is just not worth trading at this point.
Google posted better than expected earnings. Keep in mind that the street already lowered their forecasts so it made it easier for Google to beat the street. The stock is trading up about $35 in the afterhour’s market. The chart clearly shows it has been in downward pattern for many months. I am going to test my concept that a bear market is unbiased to its victims regardless of earnings and fundamentals. I do not need an analyst to tell me that next quarter more companies will spend less money on advertising. It is a no brainer so I am going to take advantage of the markup on GOOG and I will short 5 shares of GOOG at the open with a Sell Short limit of 405. We will also place the GTC buy to cover order simultaneously with a 350 Bid. Our stop will be set for 445. We will await our gain /loss in the next 3-5 trading days.
Who in their right mind would short such a beast? Baby Trader, that's who. This is a lesson of being non committal to any company in the market place. Look at the chart above and notice the nice rally today closed right at the 5 day moving average. This was a mild relief / oversold rally today. The 5 day moving average now begins to factor in lower closing points it will force the moving average to push lower and make the market fall some more.
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1 comment:
Thanks for your fun blog, I can't get enough!! Wondering what your thoughts on the solar sector are with oil so low and who are the key players in your eyes? Thanks, mini17mugs
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