From the Trading Desk

Small Caps March Forward; Volume Falls

The Dow Jones Industrial Average fell for the 4th straight day, but the NASDAQ and S&P 500 snuck out gains. Russell 2000 rose again, but finished well off the highs of the session. Volume fell across the board and failed to keep up with Monday’s pace. The market seems to be in a bit of “no man’s land.” Our focus remains on our stocks and our signals. How we react will determine our performance. There are no two ways about it. Either you remain discipline or you run the risk of ruin. Our job is to protect our capital and to grow it. As we step towards the end of the week, month, and quarter it would not surprise us to see this market move higher. If the market rolls over our stops are in place to protect ourselves. Be prepared for anything that may come our way.

We are going to contend with end of the quarter window dressing. Monday’s heavy volume selling will likely be it for the week, but its low will be important. I know there are a lot of people who are starving for a correction. It has been a long time since we have had even a 5% correction. This does not mean we are going to have an epic crash like 1987. It would be something else to see market participants get pancaked. Our subscribers and us would be protected as our stops would have us well out of the market before something like that would occur. Sadly, most would be impacted by the decline. It is always important to know where your exits are at all times just in case you need to escape.

Continue to grind this market out. We hope you finish this month out strong and look forward to a great October. We can’t force anything in this market and only take what is given. We cannot trade what we hope for, but only what is. Let others engage in the nonsense. We hope you have a great day of trading.

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