The financials, which led this market up, then subsequently led this market down in the February crash, closed firm on Friday after working through what we like to call a high consolidation pattern over the past two days.
Buyers have regained the upper hand here, but prices are back at their 50% retracement marks. They need to capitalize on the hand they have been dealt in order to keep the trend alive. Until we see prices following through higher, it is a good idea to be conservative here and to not commit any more money to the market than you already have working.
This may be the opportunity where we should be buying hand over fist, but until we see a higher weekly close this week we will not take that gamble. Right now we have a "show me" attitude about the market. As we mentioned last week, no one has a working crystal ball. We can only measure probabilities. If bulls seize this opportunity then probabilities will greatly improve. At that time we will get aggressive like we were pre February 27.
5 comments:
today i would choose to short dow with 12465 as enter limit. regard.
not take the profit.(12400)
now go longing the dow again! (1239%)
now sell the dow back for the same or better price. we will buy it again later for less money.
finally go longing the dow! (entering for 12370 if possible)
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