Volume was up across the exchanges during Wednesday’s trading session. Major Indexes ended the day flat, but the Russell 2000 was able jump .22%. The increase in volume on a flat day isn’t a huge deal, but we do not want to see the market spin its wheels with volume increasing over time. For now, it appears we may be getting a form of consolidation. It will be important we avoid excess distribution for the next few weeks. Moreover, any weak action in leading stocks would be a sign of trouble. Always obey your trading plan. This market will go where it wants to and we are here to go along for the ride. Do not fight the tape. Let’s see where this market takes us.
February is ending it has been historically a difficult moth for stocks. We are heading into a seasonally friendly period for stocks. Looking further ahead we do get “Sell in May and Go Away!” While we are mindful of seasonality the most important thing to focus on is price action. Have a game plan to take advantage of gains, but have downside protection in case the market turns against us. No one knows the future and certainly not where the market is heading. If you come across those who tell you they know where we are headed run away as fast as you can. We play the price trend not a crystal ball we stumbled across on the beach in a magical paradise. Oh wait, Maui is a paradise. Unfortunately, there are no crystal balls only hard work and love for the grind.
There are plenty of stocks setting up in decent bases and those that continue to act well. It is of the utmost importance we keep our focus on our stocks and risk management process. We want to remain in winning stocks not laggards. Hope is not a trading strategy and will only restrict potential gains. Too many traders wish and hope their stocks move higher only to see other sky rocket higher. We want winners and to let go of our losing stocks. While we won’t catch every winner, but we will get majority of some that make huge gains. This is our goal. Stick with Big Wave Trading and we will extract big gains while limiting our downside risk. Come join us!
We hope your week is going well and you enjoy the up coming weekend!
