Today’s stock market session was not what the bulls wanted to see. The delusional bull will see right past today’s heavy volume reversal, but the prudent investor knows better. While we are neither bulls nor bears today’s session certainly puts the odds heavily in favor of this rally attempt failing. A distribution day right after a confirmation day nearly always sends a signal the market is just not ready for prime time. There is not much going for the market other than hopes of more QE from the Federal Reserve. For now, we still remain cash heavy and waiting for clear signals from the market.
We noted last night the lack of breadth in this market. Leadership still remains thin and lacking substance. While we are not expecting an overwhelming number of new leaders we are expecting a few more than what we are seeing right now. Coupled with the fact seasonality is not in our favor this market stand little chance to sustain any sort of rally. Given more time and price action to tighten up we expect to see leadership emerge. Until then there is no need to be a hero and try to make something from this market.
There are quite a few traders we are seeing trying to force trades here. What most beginners do not realize is there is a time to simply stand aside from this market and times you need to be in it. The temptation to skim a point or two is just too great for many when they should simply let odds work in their favor. Majority of the time acting when you should be staying still will only lead to heartache and pain. Do not be fooled by the Wall Street machine.
Pretty interesting a service like Big Wave Trading would tell you to not act. Well, we are not just going to make something up to keep people active. Once September clears and this market tightens up we will have our opportunity to capitalize. However, in order to capitalize we must have dry powder on hand to take advantage of a possible new uptrend. We do not want to miss huge moves to the upside and cost ourselves a chance of really improving our performance. It pays to sit and wait for the proper moment where odds line up in your favor. It is a simply approach, but one few can master. We are here to help.
This market will try and maximize the pain for as many people as possible. Stay patient and our time will come where we have a sizeable opportunity. Stay tuned.
