Wednesday, November 3, 2010

Market Update November 3rd

As confusing as the market appeared to be today, all the action took place inside the trendlines drawn days ago. The market tested the lower trendline and stopped on it as if everybody watching that line. And now that 1196 finally broke, it seems like the market will make an move to break out of the triangle tomorrow. It could well test that lower trendline again but based on the EW count, it favors a gap up. The level to watch was visited just briefly, a few seconds if that and it worked great as a spot to go long.

I broke my own trading rules today by going with "hunches" and reading the news too much. So I ended up losing on 2 day trades but I am all cash again and learning from my mistake. Short only at extremes in an uptrend, long only at test of trendlines and oversold extremes if the market is above the level I watch. Had I followed my own advice, I would have had a very good day.

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