The Complete Opposite

April 30, 2002
Dave Floyd

I finally heard an accurate way to
summarize the current market action from a colleague yesterday; it is the
complete opposite of the bull market from the late ’90s, early 2000-01. Although
it may appear that that is not a terribly insightful statement, it actually is.
Over the last few weeks, any rally whatsoever has been sold. Just three to four
months ago these same sell-offs were aggressively bought, creating some pretty
big volatility spikes over several days. Does that mean there is no significant
rally in the cards? Certainly not. However, at the risk of calling the bottom by
my following statement, it appears as though the market is trading on
“real” news vs. “unrealistic expectations.”

I have shared a couple of trades from yesterday’s session as seen in the
charts below. The Qwest
(
Q |
Quote |
Chart |
News |
PowerRating) trade was not
an HVT setup, but demonstrates the advantage
of remaining flexible when price action gets slow. This trade was based purely
on a setup on a 15-minute chart. However, the setup itself is identical to a
setup I would look for off my usual one-minute bars. I do my best to alert you
to these in TradersWire during the day.