Thursday, December 19, 2013

Market Update

The market spent most of the day consolidating its gains from yesterday's rally and it looks like it is preparing to break resistance. However, until that happens we just have to wait and see so I am still waiting before I start labeling the waves. I ended up selling my VXX again for a small profit and I am waiting for the next set up to go in long or hedge. I'd like to see the TA tested and see how the market handles the pullback, if the TA holds it will be very likely that we get a Santa Rally. I already have about half of my fence paid off so just need the market to cooperate a little more.

On a side note, something very important for the economy that might have been missed among the main headlines of taper is the Feds willingness to keep interest rates near zero. This encourages spending and keeps debt costs low for companies, a formula that has worked very well since the financial crisis. Obviously, the risk is we might see asset bubbles by keeping this policy but that's something another Fed Chairman will have to deal with down the road. I know some people dislike Bernanke's policies but I for one am thankful he was in charge when the financial crisis occurred as I think he implemented a policy that saved the country from a very long recession/depression. That and the fact that I have a 3.5% 30 year mortgage and couple of 0% loans floating around thanks to his vision. So I wish the man well in his future endeavours and hope Yellen will do just as well.

Short Term Trend = Bullish
Medium Term Trend = Bullish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors. 

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