Dispite mediorcre economic data the NASDAQ was finally able to hang above 5000 and close there as volume swelled across the board. The Federal Reserves Beige book release did help the market push higher, but given volume was higher across the board demonstrated institutions were willing to put cash to work. It is finally nice to see the market push higher with volume following alongside the move in price. We really have not seen price and volume move in tandem. We still seem to lack the ability to close out at the highs of the session, but for now this is a small blemish on the market. While today was a nice move we will need to see the NASDAQ move from this recent consolidation. It is nice to see price and volume move in tandem, but we need to see this market confirm its trend. We are nearing an inflection point in this market and for those not aboard will miss out on some gains.
We had a stock for our platinum subscribers in our intrday watchlist breakout today. Unfortunately, the stock was unable to close out on its highs. However, it highlights when you chase a stock rather than buying properly how much it can affect your overall performance. Chasing the stock at the open only lead to some pain rather than holding tight and waiting for the proper by. Although the stock issued a sell despite breaking out your loss would have been minimized simply by not chasing. We know cutting losses is uber important, but having a sound entry plan is just as effective.
Bias is certainly to the upside here. Given central banks are hell bent on keeping asset prices inflated it is hard to bet against them. Sure, at some point there is a possibility betting against them will make sense. However, right now in this environment is very difficult to bet against central banks. We are not predicting this market is going to do one thing or another. Simply put, the market has central bank wind at its back and we are not about to fly against it. Sure, at some point in the future it will be prudent to do so. At thsi time it is unwise to bet against central banks.
A sound trend following strategy will get you a head in this market. We have been a beneficiary of central bank free money. At this piont, given the EU mandate of buying EurZone debt the market will be flush with capital and at a cheap rate. Rather than guesing what might be a winner a proven strategy of following winners will be head and shoulders above the rest. Stick with Big Wave Trading as we shred this market up.
Stick with the trend and at this point the bias has shifted to the upside.
