Friday, September 23, 2011

Market Update; Trader Thoughts (9/23 - 7am)

The stock market has dropped swiftly and viciously the past few days.  This has impacted most other markets -- including crude oil, precious metals, commodities, currencies and fixed income.  A few quick thoughts from the blog's contributors who are traders and investors:

  • Don't try and catch a falling knife.  We had a blog post recently about this...
  • Trade down to the level that lets you "sleep at night."
  • Stick to your trading plan and/or system.  Systematic approaches maintain discipline and reduce the impact of emotion and psychology.

We are writing an article for Seeking Alpha on some of these topics.  And in case you were wondering:
  • Our stock market indicators are currently "overall" bearish.
  • Our short-term indicators have dictated our stock market positions because the other indicators (long-term and intermediate-term) were neutral.  
  • As our readers know, our intermediate-term and long-term indicators went to neutral on our last post on stock market indicators -- when the S&P was at 1216.  
  • Currently, however, our long-term model flipped to bearish (depending on market action, this may change; we will keep you posted).  In addition the intermediate-term indicators are moderately bearish (but a look-ahead shows that the oversold indicator may flip to bullish in the near-term). 
  • The S&P closed Thursday at 1130. 

No comments: