Forget about what the media is telling you
Dave Landry is principal of Sentive Trading, a money management firm, and a
principal of Harvest Capital Management. Mr. Landry is the author of two top
selling books,
>Dave Landry’s 10 Best Swing Trader Patterns And Strategies and
>Dave Landry On Swing Trading.
If you would like a free trial to Dave’s Nightly Swing Trading Alerts Report
On Tuesday, the Nasdaq traded sideways throughout the morning, tried
to rally in early afternoon trading, but then reversed and sold off fairly hard.
This action has it closing poorly. Â
The S&P tried to rally but also reversed to close poorly.Â
So what do we do? I try to limit my market related T.V. to
watching the ticker at lunch. And in that brief period, I noticed that the media
was very excited because we were “about to make new highs for the
year.” Hmm, I thought, it doesn’t “feel” like a bull market–at
least not in my portfolio. The market then promptly reversed and sold off hard.
This action forms an outside day down in the S&Ps. I’m sure some
“candle people” out there will have some sort of name for this–an
engulfing black cloud crow or something. Whatever you call it, it’s certainly
not bullish. Therefore, proceed with caution on the long side. Ideally, wait for
the the S&P (and other indices) to break out decisively to new highs
and then look to get long if it can hold new highs (on a pullback).
No setups tonight, Tuesday’s action puts us back in “wait-and-see”
mode.
FYI:
On Wednesday, 11/16/05 at 11:00 A.M. Eastern, I will be doing my weekly
interactive presentation. In addition to market conditions, I will be covering
some recent examples (some worked and some unfortunately, did not!). I will also
take your questions. Admission is free but limited by the software. Email me if
you need instructions (the same each week).
Best of luck with your trading on Wednesday!
Dave Landry
P.S. Reminder: Protective stops on every trade!
P.P.S. If you would like a free
trial to my trading service, click
here.