The expanding flat count I posted Thursday seems to be evolving as projected. Going by the micro count, the C leg of this expanding flat is playing out and once over it should get interesting. The market should either go down in a C or bearish W3 leg or resume the bullish leg that started at 1628. With the ongoing political drama in Washington, I don't really see a big rally before the main issues are resolved. But then again, I didn't think the market would hold up this well considering the government has shut down for almost a week. Also, small caps reached an all time high this week and the NASDAQ is also at a post internet bubble high which are signs that investors and traders have a "risk on" attitude.
So given the different potential scenarios (which are as good as flipping a coin), I am trading with the trend. I am fully invested on my long term portfolio as usual but I am all cash on my short term portfolio. I sold my GXC at a good profit on Friday and again will take positions only at key levels, which are now support at 1670 or above the TA. I've been realizing lately that I am much more comfortable being long on a stock I have confidence in than being speculatively short, when I am holding something like VXX I just don't sleep as well, even if it's a minor position. Whereas holding a stock like Google is completely ok since I actually own a piece of a company which business model I understand. So from now on, I think I will start doing only or mostly long positions on my short term trades.
Short Term Trend = Bearish
Medium Term Trend = Bullish
Long Term Trend = Bullish
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