Futures were quite the rollercoaster ride in the early going. At around 4am EST futures were down more than one percent across the board. By 7am EST they were all higher across the board. Quite the turnaround as the Euro situation remained front and center. The market did get a dose of good news, relatively good news as jobless claims were better than expected. However, a weaker than expected ISM non-manufacturing reading disappointed the market. From the start sellers dominated the first half hour of trading, pushing the NASDAQ into negative territory. Volume was hot too and remained so throughout the trading session. A positive sign the market was able to find buyers, institutional buyers at that. Today’s market put a hold to the market under pressure, but we remain prudent and disciplined.
Tomorrow we’ll get the all important jobs report from the Government. Early in the week the market saw the ADP employment reading higher than expected. A guess, we created more jobs than expected. The guess however does NOT make us money and trying to do so is foolish and goes against discipline. It is still fun to see how many do try to “play” the jobs report. It is utter foolishness, but still comical. We’ll remain disciplined and use price and volume to guide us. Nobody knows the future; it is useless to even try to predict it. Have a plan of attack, execute it, and know when to get out!
Not much surprises us in this market and today’s action is no different. The NASDAQ was able to retake its 200dma with volume, a very good sign for the market overall. We must be careful here, any volume reversal would signal trouble from these levels. Again, we aren’t going to try to anticipate the move, but if it happens we have a plan in place to take advantage of the situation. Do you have a plan?
The number one rule still applies here, CUT YOUR LOSSES. I repeat this because it is very important lesson to learn. Humans are not built to take losses; it is difficult to admit you are wrong. The truth is you are going to be wrong. Learn from it and move along!
