The market continues to consolidate its recent gains as volume ticked higher than Friday’s session. Losses on the S&P 500 and NASDAQ weren’t big enough to trigger distribution, but both indexes have 6 days worth of distribution. TWTR continued to slide even as the stock found support at its current low. FB added to its losses as well. So far the recent two day pullback is quite normal and not overly concerning. Even with the high level of distribution this market has been able to fend off bouts of distribution. We remain in an uptrend and until otherwise proven we should continue higher.
We do have on some market hedges using the likes of SRTY, but we don’t expect this recent pull back turn into anything serious. With that said, we understand anything is possible and if this market turns south we have our hedges. At this point anything is possible and we still have the Federal Reserve pumping a ton of liquidity into the market and should keep this market afloat. The best plan of action is stick to the Big Wave Trading process! No need to make “market calls.” We don’t need to appear smart, just right.
As stated last week we do have plenty of stock market bulls out there. Not to mention we have quite a few stocks over their respective moving averages. In a typical market when the number of stocks over the 20 day moving average is over 75% the market will correct. Add in more than 75% of stocks are over their 200 day along with the 20 day we usually have a decent sized correction. In this QE environment we just haven’t seen any meaningful correction.
One day left for this 2013. It has been a wonderful year and we look forward to 2014. Take advantage of our 40% off sale by using the coupon code: YEAREND! Ride those winners!
