Here’s The Interesting Thing About This Move

The
market seems to be pausing after the burst of energy it expressed
that has propelled the NASDAQ above prior resistance at the 2,100-level. 

 

 

The most interesting thing
with the recent move higher is that it came after two weeks of blatant
distribution.  6/30, 6/29, 6/24, 6/23, 6/7 and stalling on 6/22 apparently
meant very little.  This market has been trading like this for the past two
years and it is very difficult to navigate.  Obviously, anyone can go out and
buy stocks when the market acts weak and sell them into the strength, but the
risk that involves is more than I would personally like to take on. 

Identifying true leaders and
sticking with them has been important.  This market has not left much room for
mistakes.  Retail, select internets, homebuilders and of course oil have
continued to rise. 

If you don’t have your finger
on the pulse daily, or be very confident in the trend of an investment, you
can get caught quite easily.  Writing covered calls has performed very well in
this market and may continue to do well.  Even with this strategy, the trick
is that it is still important to find the right stock to write a call on.

As we proceed, I would like
to see more volume come into this market on the upside.  Leadership such as
GOOG, CME, BEBE and DNA need to keep up the current pattern of rising,
consolidating, rising and so on.  If we start to see them roll over as a
whole, it may be a good signal that the market is about to follow suit.

Good Trading to you!

Tim Truebenbach