There is certainly a neutral/negative sentiment in the market. AAII Bulls dropped to 28% this week while the Bears inched up to 30%. Neutral respondents are taking over once again. The average investor most likely cannot deal with the volatility in the market despite volatility moving lower. The uncertainties of the global trade market as well as geopolitics cloud most traders’ judgment. We simply prefer to use price action to guide our actions. We have a solid risk management system to maximize our profit potential and minimize our downside. We prefer to be in this game for a very long time and the key to success is to protect your downside. Unfortunately, most do not have a solid understanding and fail at their trading endeavor. Let us help!
Yesterday’s distribution day is not a good look for the market. The only saving grace happens to be Small Cap stocks. Pre-market we see TSLA and NXPI suffering from big losses. SPOT too is lower after reporting its first ever quarterly earnings report. Earnings appear to be solid, but typically great earnings occur at market tops and not the other way around. Is this a top? No one knows, but we will be quick to take action with however the market reacts here. Keep a close eye on February and April lows in the S&P 500. It would not be a surprise to see this market quickly jump below those levels including its 200 day moving average.
We hope you have a great day of trading today. This market is quite fascinating with large cap stocks struggling and small caps hanging tough. It will be fun to see how we proceed from here. Keep your losses small and proper position sizes.
