The market is appears to be waiting on the Greek referendum on Sunday. Volume fell on the session as it appears many were ready to start the holiday weekend early. We cannot blame them one bit. Today’s action was neither favorable to the bulls or bears. Whether or not Greece is truly holding back us trend followers continue to manage our trade signals and risk. Those who are worried about Greece should take a good look in the mirror. Manage risk, ride your winners, and cut your losers. It is a recipe for success even in this market.
We are certainly interesting times geopolitically. Greece is in its second go-around this century with issues regarding their debt load. Logically speaking, it is tough to pay down debt when you have trouble generating income. Unfortunately because these issues were not taken care of a few years back we now are once again held hostage to the constant barrage of media reports generating from this situation. In the end, something will be done and we will simply follow how the market reacts. It is a waste of time trying to figure out how this market will react. Go with it rather than fight it.
Sentiment has shifted back to the bear camp with a big reading from the AAII Sentiment Survey. 35% of survey respondents were Bearish on the stock market over the next 6 months. 22.6% were bullish on the stock market. NAAIM exposure index continued to show active managers reducing equity exposure. Strangely enough no one is -200% bearish. The largest short position is only -150%. While as a whole the index is moving lower the largest bullish exposure increased week-over-week. A bearish sentiment does put a feather in the bulls’ camp.
We hope you have a great long weekend. Go out and enjoy it. Sunday night will be interesting with Twitter likely going nuts over the referendum vote. Stay the course and cut those losses short.
