Indices have been on a roll for the last 21 trading days, here is the stat for last 21 trading days :
S&P 500 UP 13.56%
DOW UP 13.99%
Nasdaq UP 15.75%
In a normal year for indices average gains are 8%, based on historical average, we have almost doubled gains so far.
Here is another look @ RSI :
S&P 500 59.92
Nasdaq 59.93
DOW 60.42
Based on history, high 60's always result in pullbacks, but more often pullbacks can start @ low 60's also, as has been the case in recent months.
The question is why did we rally so strongly ?
First, we were deeply oversold based on RSI in 20+ & 20% + slump in indices.
Fed was hawkish
Now the above 2 have reversed, we are getting overbought and Fed is dovish.
Shutdown is over for 3 weeks and may get messy again...
Trade talk resumes in DC but China & US are miles apart.....
SO...all the euphoria about Fed being dovish is already factored in the market...
On a technical basis resistance is about 2% to 3% above where we are as of Friday.
Based on all of the above analysis, It is extremely critical to book profit and reduce exposure...fighting for last $$$ or last 5% is never a profitable strategy.....
Good luck with your own interpretation of this TAPE.
BLOG does NOT give buy or sell.
Saleem
7 comments:
Hi Saleem,
Last week: +0.17% (YTD: +0.42%)
Notable Winners: LQDA VRNS TRIL ACIA SAIL MHO
Notable Losers: ORTX HEAR VCEL
Even though I roughly performed in-line with the markets, I do feel like I had some opportunities lost with big losers offsetting some broad winners. Despite how positive the backdrop is in the entire market, it's not easy to play the ups and downs correctly. I hope my mix of companies is appropriate as we approach the bulk of earnings season. I still feel like the broad TNA is a very good way to get exposure right now.
Holdings: TNA MHO VRNS SAIL VICR ACIA ORTX LQDA VCEL HEAR TRIL NIU, cash 0.2%
Stocktrader
Hi Stocktrader,
Last week UP 17.63%
YTD UP 74.68%
Saleem
Hi Saleem,
Oh my goodness, so amazing!
After a challenging year last year, I think you've made it all back and more in one month. Keep up the great picking!
Stocktrader
Hi Saleem,
Sold off some poor charts in the portfolio:
Sold VCEL @ 16.27
Sold NIU @ 7.54
Stocktrader
Hi Stocktrader,
Appreciated your take on my 2019 start, yes it covers 2 of the 3 bad year already, IF luck holds up and my strategy of " take the money and run keeps working " I should be able to capture 3 years of losses.....
I looked @ my reasons real closely and came up with different format which was my " old format of not getting greedy " and change in selection of stocks based on swing or daytrade format...so far it is working.
Good luck with your next pick.
Saleem
Superb Returns Saleem. I wish it continuous with same pace.
Paramjeet
Hi Paramjeet,
Appreciate your good wishes.
Good luck on your stock picks!
Saleem
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