Here we are with 7.4% YTD gains in S&P 500.......
Every trader is very comfortable with this market....
Every index is @ all time high or 14 year high....
BUT....there is a time for indices to pull back to regain its health & its uptrend...
RSI is @ 73.62....its in nosebleed territory.....anyone cares?
I am expecting a fast 3% pullback which "is imminent"
That will take S&P 500 down to 1925 area.......
In order to counter this downtrend some sectors looks prime for further move UP
They are out of favor & looked down sectors like Base Metals, Precious Metals......
Out of favor sector can offset some of the losses in Big cap techs & other in-favor sectors....
Interest rate jitters will cause this decline as highest jobs growth in 5 consecutive months since 1999 will take a toll in the form of higher mortgage rates & other consumer rates.
The other problem for this market are those traders & investors who sold out in 2008 do not trust equities. Every correction reinforces their belief in staying away from this casino.....
SO..it may not be a bad idea to book gains even small ones until we complete corrective process.
Old belief of earning season bullishness may not be the catalyst this time around until we correct.....they will say "good news already priced in"...or "guidance is in line or weak"
Good luck with your own read of this TAPE.
BLOG does NOT give buy or sell.
Saleem
8 comments:
Yea, I regret not selling Thursday.
Everyone expects a pullback soon, so a pullback is inevitable. Everyone is saying overestimated p/e are currently factored into the market.
I say that though obviously new to trading.
I'm frustrated though. None of my picks have risen much.
Hi Firebird,
Sometimes it is about avoiding losses and preserving capital...
Saleem
Hey Saleem,
I forgot to mention I'd be on vacation this weekend through today. I also expect some pullback on interest rate jitters, although in line with a standard retreat within a bull market. I think we are in a bit of win-win right now: either the world economy stumbles and we have to stay accommodative, or everything starts moving forward together and we get top line growth finally.
Bought PFPT @ 36.00 this morning as I'd been waiting for a pullback into the $35 range and couldn't be around to watch that closely today.
GTAT getting hit hard--ouch!
Stocktrader
Hi Stocktrader,
Good luck with PFPT.
GTAT was downgraded by UBS.
Enjoy your vacation.
Saleem
Patience is the operative word in this market
Hi Charlie,
Patience is a definite asset when indices are down.....
Saleem
Bought more DAL 37.1
Hi Firebird,
Good move..airlines on Sale...
Good luck with DAL.
Saleem
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