Traders have 2 choices right now
Timothy J. Truebenbach is the
President of True Capital Management and general partner of True Capital
Partners LP, a hedge fund. He uses a disciplined model that trades on the
intermediate-term time frame. For a free trial to Tim’s Nightly Stock Analysis
Report
click here or call
888-484-8220 ext. 1.
It is starting to get really ugly now that the
major indexes cannot rally or even bounce in a significant way. In early May,
the major indexes posted heavy distribution, or professional selling and have
not looked up since.
Commodity prices and many leading stocks have taken it on the chin since the
market topped on 4/20 for the NASDAQ and 5/8 for the S&P 500. The S&P 500 closed
below its 200-day
moving average
for the first time since October and trading below this key area of
institutional support does not bode well for higher prices.
The best thing to do at this time is move money into one of two places. The
first solid option is the sidelines; out of harm’s way. If you are a stock
picker, a down trending market can even de-rail solid leaders like Hansen
Natural
(
HANS |
Quote |
Chart |
News |
PowerRating).
Your second viable option is to pick an appropriate asset allocation model for
yourself and stick it out in the various asset classes for the long-term.
Everyone wants to do well when the market is firing on all cylinders, but when
it hits the wall it is best to have other assets or at least cash to find
comfort in.
Tim Truebenbach