Friday, April 11, 2014

C or W3?

The sell off continued today and bottom came close to the 1812 level I mentioned yesterday as the ideal target for the C wave so we should get a better idea next week if this sell off has been a correction or part of a bigger correction. If we get a bounce to the 1837-43 area and reverse, then  it is likely that the bottom will be in the sub-1800 level. However, a counter rally that reaches 1872 will be setting up the market for the resumption of the bullish trend and consequently new all time highs. Either way, there's a good change for a counter rally (or reversal day) on Monday as the market has sold off a bit too fast on no news.

I bought a position in the pharma stock I was trading few weeks ago and XIV at the bottom today. I am not going to get greedy so I am just looking for 1837 to sell them both at a profit (unless we get something outrageously bullish). The risk for taking a long position at this point is if we get a bearish W3 with no sub-divisions then I'll have to sell at a loss on Monday. I was already ahead on XIV by EOD but I decided to roll the dice.. add some excitement to the

Have a great weekend.

Short Term Trend = Bearish
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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