Archive

Archive for the ‘Stock Market Strategy’ Category

WALL STREET CRAPS STOCK MARKET STRATEGY AUGUST 13, 2017

August 13th, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR AUGUST 13, 2017: The stock market has now reached short-term oversold levels according to many internal indicators. This sets up the market for a “bounce” to higher levels. If the general market advances quickly at the beginning of the week, we may get left behind as the market would have bottomed on last Thursday. But if it should decline early in the coming week, we may be presented with a short-term buying opportunity for a quick ride up to challenge the old market highs.

Key underlying short-term timing indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “Fear” which serves as a buying alert. My market discipline is that a buying opportunity is only acted upon once the Fear/Greed Index reaches “Extreme Fear” levels. That could occur early next week if the market should continue to decline. But since prices have not decline very much from the market highs, any buying will be in stocks or ETFs with only short-term (not intermediate-term) oversold readings.

This opportunity will not be the case of buying low and selling high, but more like buying high and selling higher. This is not the time for bottom-fishing, but instead is a time to buy only those issues with a high correlation to the general market. Or simply restrict your buying in S&P 500 and/or Nasdaq 100 equivalents.

Note: None of the broad-based ETFs in the major indices are currently oversold. This could mean that a better low may be coming later when these ETFs do become oversold.

WALL STREET CRAPS STOCK MARKET STRATEGY JULY 29, 2017

July 30th, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR JULY 29, 2017: The stock market has corrected internally while not giving much in price as evidenced by the near oversold readings in the 5 indicators listed below. This suggests that another rally could be coming soon after another drop next week. But with the large decline in the Dow Jones Transportation Average last week, I’d be careful about taking larger permanent positions. The next set-up to the upside will likely be a sharp quick rally at best.

Key underlying short-term timing indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “Greed” after being in the “Extreme Greed” range for 3 days last week. This suggests that there is enough euphoria among market participants to warrant extreme caution. But with the internal indicators that I follow approaching “oversold” readings, I’d be looking for any decline in the next few days to be only temporary. This could be just another “dip” worth buying in this seemingly endless Bull Market.

WALL STREET CRAPS STOCK MARKET STRATEGY JUNE 18, 2017

June 18th, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR JUNE 18, 2017: The stock market is in a neutral position with an equal probability of going either up or down. Expect the market to set itself up for its next big move by creating a false small move in one direction or the other – followed by a stronger move in the opposite direction. If I had to guess, the market will probably decline throughout the week – setting up a larger rally to follow. All we need is the market to show some “oversold” readings in order to act.

Key underlying short-term timing indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “neutral” suggesting a balance between bullish and bearish sentiment. If we should get “oversold” readings in a few of the internal indicators or an “Extreme Fear” reading in the Fear/Greed Index, we could be setting up a chance to “buy the dip” for another ride up to higher highs.

WALL STREET CRAPS STOCK MARKET STRATEGY APRIL 23, 2017

April 23rd, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR APRIL 23, 2017: The stock market remains in a neutral position with the ability to go in either direction. The last two weeks has presented the market with an opportunity to become “oversold” but rallied modestly instead to prevent investors and traders from getting to a low-risk entry point. Expect the market to set itself up for the next trading opportunity in the coming weeks, but right now it’s best to take a wait and see approach to this tricky news-driven market.

Key underlying short-term market indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “Fear” after being in the “Extreme Fear” range for only one trading day. I would expect a much deeper reading in the “Extreme Fear” range in order to safely say that the stock market is “oversold” or “under-loved” in terms of sentiment. The current geopolitical climate should serve to push sentiment strongly in one direction or the other. And most likely, it will create the desire emotion of “extreme fear” which allows presents disciplined traders with a low-risk buying opportunity. So right now it’s best to let the market set itself up for the next trading opportunity.

WALL STREET CRAPS STOCK MARKET STRATEGY APRIL 8, 2017

April 9th, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR APRIL 8, 2017: The stock market remains in neutral territory despite the unstable news background. But the news will help create the cover story for the next top or bottom as it will polarize public sentiment. Right now it appears that the breadth oscillators are heading down towards an oversold bottom in the near term (3 to 5 days). If the readings become low enough, a rally worth trading to the upside may be in store for us. But until those low reading occur, it’s probably wisest to keep your powder dry for better odds in playing this tricky market.

Key underlying short-term market indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “Fear” after being in the “Neutral” area for a week. The set-up in the breadth oscillators suggests that a short-term bottom is nearby. If the Fear/Greed Sentiment Index can register an “Extreme Fear” reading in the meantime, we may have a sharp rally to ride into May. But until that sets up properly, it’s best to do nothing except get your ducks in a row.

FEAR/GREED SENTIMENT INDEX – MARCH 26, 2017

March 26th, 2017 Comments off

The “Fear/Greed Sentiment Index: What Emotion is Driving the Market Now?” reading has moved into the “Fear” range this past week. When it reaches the “Extreme Fear” area, it will become one of the pre-conditions for an intermediate-term stock market bottom.

So any further weakness in the general market will probably put this index in the “Extreme Fear” range which means that it’s a time to start getting your feet wet with a diversified long position. My favorite plays would be the SPY and QQQ Exchange-Trade Funds.

But since the last market top was not very far from the current position, I’d look at this next bottom as being only a starting point to challenge the old highs.

WALL STREET CRAPS STOCK MARKET STRATEGY MARCH 19, 2017

March 19th, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR MARCH 19, 2017: The stock market is currently continuing its “bounce” off of a short-term oversold condition. This bounce has not been very strong and is approaching the “overbought” range. This suggests that the buying is not very strong and another round of declines will resume shortly. A better buying opportunity will likely present itself in the future, but when that will be depends on how oversold the market can become. In my opinion, this is a good time to be out of the market.

Key underlying short-term market indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “Neutral” after being in the “Greed” and “Extreme Greed” for several weeks. If it can continue to weaken into the “Extreme Fear” range, we could be in store for a good intermediate term bottom in which to buy into. But right now, it’s still anyone’s guess which direction we go and for how long. But at least, we are getting a correction from the rally that left most investors behind.

WALL STREET CRAPS STOCK MARKET STRATEGY MARCH 5, 2017

March 5th, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR MARCH 5, 2017: The stock market blasted to a new high on its new leg up after President Trump’s State of the Union address. The relentless rally continues with a possible pause next week followed by another quick rally to retest this week’s highs. What is surprising is how close the internal indicators are to being “oversold.” This could mean that a short-term buy signal is not far away and this seems to make almost no sense at all. I’d be looking at the Volatility Indicator for the best timing tool for this next bottom.

Key underlying short-term market indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “Greed” after being in the “Extreme Greed” for a few days last week. This doesn’t mean that the market is going to go down. It just suggests that you shouldn’t be buying at this time. This type of strong upside market is not one that you’d want to play the short side on. Instead, look for short-term oversold conditions to pop up that offer you a good chance to make some fast money with less risk. Don’t be too surprised if this market continues to climb the proverbial “wall of worry.”

WALL STREET CRAPS STOCK MARKET STRATEGY FEBRUARY 26, 2017

February 26th, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR FEBRUARY 26, 2017: The stock market continued its relentless advance last week with its 1th straight closing high. Normally, this would qualify as an upside blow-off with only one remaining piece to the puzzle: a large one-day reversal to the downside usually triggered by an obvious piece of good news. That reversal would mark the internal high of the market and would likely be followed in 5 to 7 days by a final weaker retest.

Key underlying short-term market indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “Greed” after being in the “Extreme Greed” area for most of last week. The internal indicators are surprisingly close to “oversold” readings which would appear to make no sense at all. Because of the mixed signals and the 11 consecutive new closing highs, it might be smarter to step aside and watch the fireworks. This strategy would be wiser rather than trying to play the genius by betting large sums of your after-tax capital on risky bets.

WALL STREET CRAPS STOCK MARKET STRATEGY FEBRUARY 12, 2017

February 12th, 2017 Comments off

craps front coverSTOCK MARKET STRATEGY FOR FEBRUARY 12, 2017: The stock market continues to push higher without the slightest correction. The news background continues to be of relentless optimism in terms of the outlook for business and the economy. This public sentiment should equate to a market intermediate top in the not-to-distant future. The internal indicators are trending up towards the “overbought” region with a decent possibility of a top coming in the next week or two. If your strategy is to buy low and sell high, then we are probably already in that “sell high” area now.

Key underlying short-term market indicators show the following:

***********

THE BOTTOM LINE: The Fear/Greed Index is currently reading “Greed” which allows for more room to the upside. Once is reaches the “Extreme Greed” area, it would be prudent to start taking some more chips off of the table. The stock market casino is always open so missing some profits is a smart strategy overall when the risks of losing money are far greater. The odds of the stock market game strongly favor lightening up as we enter the area of “Extreme Greed.”