Wednesday, December 9, 2009
ENTANGLING: UNFAVORABLE MARKET CONDITIONS
RANGE COUNTER: 20 DAYS
Range counter is at 20 days now. As the market teases the bottom of this range and then teases the top of the range it is almost like a game of chicken. You know: I dare you to break out or I dare you to break down. Neither the bulls or the bears want to make the move that can possibly take us the next direction. A game of chicken. Just a game of chicken.
Some may ask: why do you wait for the futures? Aren’t there some good trades? Absolutely! There are good trades and good set-ups every single day. Hundreds, even thousands and I miss every single one of them. Why? Because I cannot possibly trade all of them and I have my rules. High probability trading for me means you find a pattern that works and then you trade that pattern in the market in which it works. Right now a tight, sideways move, as we find ourselves in, does not present a high probability trading situation for me. Sure, I will mention trading opportunities that have set up but sound a cautionary note: trade light or not at all. Today’s move, although purely technical in my opinion, came on a very few leadership stocks which had strong moves, mainly GS and AAPL. AAPL alone accounted for much of the move on the NASDAQ. RIMM did not hurt either. More on AAPL in the Missile Launch Plays section.
So, on we go with the counter. 20 market days in a tight range. For those taking a few positions here and there and making some money along the way…congrats. For those who wait make sure your swords are sharpened and ready for battle. The rest will be well worth it.
