Thursday, February 2, 2012

One more rally?

The market has put in 4 waves from the 1300 low and we should see a final wave for this leg in pre-market or tomorrow. Once this wave is finished, the market could start correcting to the 200 day ma. However, these 5 waves might just be the W1 of the W5 and if that is the case, a small correction would serve as a launching base for a big bullish wave to the 1350's more or less. So the coming correction is important to avoid getting trapped in a position. I will probably take profit if we see the 5th leg tomorrow and stay in cash. Ideally, I'd like to see about 30-40 points above the Trend Average to short (like I did a few days ago). So I'll play it safe and enjoy what I have at this point.

Also, I wanted to point out that there is a Portfolio page on the blog that can be accessed through the header menu. Some people have missed it apparently but here is what the year is looking like for my trading portfolio (not including the Santa rally profits).

Last but not least, the TA has turned bullish again. It got whipsawed on its last signal which tends to happen usually on W4 corrections.

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