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Posts Tagged ‘stock trading tips’

WALL STREET CRAPS STOCK MARKET STRATEGY FEBRUARY 26, 2022

February 27th, 2022 Comments off
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The stock market had an extremely memorable shorten week with the invasion of Ukraine news backdrop. After a climatic bottom on Thursday’s opening, the market rallied strongly during the remainder of the day and on the following Friday. It was a classic bad news bottom and many are wondering if that was THE BOTTOM or whether there will be a retest in the coming weeks. These are turbulent times and for those with a weak stock market stomach, this may be a time to sit on the sidelines. Another good time to go long could be on a retest of last week’s low.

Key underlying short-term timing indicators show the following:

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NYSE McClellan Summation Index: This indicator has been bottoming after a long decline for many weeks now. It is hard to see any reliable signal here as it may still fall off the cliff and go to a lower bottoming level. But overall, it says that the risk is in trying to short this market as strange as that may seen.

Fear/Greed Index: This popular indicator is only in the “Fear” territory with a reading of 31. At the December 2018 bottom, this indicator reached a reading of 3. This week it reach an “Extreme Fear” reading of 25 which is just barely in this territory. I would expect a much lower reading if this is to be the final bottom and gives me the strong conviction that we still have more downside to go.

WALL STREET CRAPS STOCK MARKET STRATEGY JANUARY 29, 2022

January 29th, 2022 Comments off
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The stock market had a highly volatile week ending with a strong rally on Friday. Monday appeared to be a climatic low with several retests during the week. Unless you were an experienced day-trader, it would have been a difficult week to trade. It feels like the sentiment is strongly negative with bad news dominating the headlines. Friday’s rally may just be the fact that too many investors were on the negative side of the equation. I would expect there to be continued volatility and not a market for most investors to participate in unless in small amounts for the fun of it.

Key underlying short-term timing indicators show the following:

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NYSE McClellan Summation Index: This indicator has been declining for some time and usually needs a cluster to dots in the bottoming area before advancing. But when it turns after a cluster, it should be a sustained rally upwards.

Fear/Greed Index: This popular indicator is only in the “Fear” territory with a reading of 36. At the December 2018 bottom, this indicator reached a reading of 3. It is amazing to me that it is this high and did not come close to an “Extreme Fear” reading this week. That makes me very cautious about the current rally that started on Friday and maybe the market needs another leg down to make this indicator have lower readings.

WALL STREET CRAPS STOCK MARKET STRATEGY JANUARY 8, 2022

January 8th, 2022 Comments off
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The stock market had a rocky start to 2022. With several non-confirmations during the last week of December, it is not surprising that there would be problems this week. With that being said, the general market could stay in this range without a major move in either direction. But with the large percentage losses in many of last year’s dynamic growth stocks, the background is set for a final plunge for these shares. However, there aren’t any signs of capitulation that would mark that final bottom. So for now, I would recommend keeping your powder dry and resist the temptation of going long until we see more signs of extreme behavior/sentiment.

Key underlying short-term timing indicators show the following:

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NYSE McClellan Summation Index: This indicator has rallied from its December 20th low and is in the process of clustering at a peak before heading lower again. A tradable bottom usually isn’t signaled unless the clustering starts after a sustained move down. That point is still weeks away in time.

Fear/Greed Index: This popular indicator is in the “Neutral” territory with a reading of 52. At the December 2018 bottom, this indicator reached a reading of 3. So we are a long way away from a swing trade to the upside. A minimum reading of 25 is required to reach the “Extreme Fear” range.

WALL STREET CRAPS STOCK MARKET STRATEGY DECEMBER 5, 2021

December 5th, 2021 Comments off
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The stock market had a volatile week with large movements in both directions. But under the surface, many stocks experienced large retracements from their all-time highs. With the negative news backdrop of the new COVID strain and larger than expected inflation projections, the market is ripe for a crash and reversal this coming week. If you’ve been waiting for an opportunity to make some fast money, this week may be your week. But this next rally may be a narrow advance so I’d stick with large-cap stocks like those in the Dow Jones Industrial Average.

Key underlying short-term timing indicators show the following:

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NYSE McClellan Summation Index: This indicator has broken down and has a current oversold reading of 15. It satisfies the requirement of a bottom condition, but usually needs a cluster of readings in the lower area before rallying for a new up leg.

Fear/Greed Index: This popular indicator is in the “Extreme Fear” territory with a reading of 20. At the December 2018 bottom, this indicator reached a reading of 3. But overall, this indicator is sufficiently oversold to support a bounce upwards.

WALL STREET CRAPS STOCK MARKET STRATEGY NOVEMBER 27, 2021

November 27th, 2021 Comments off
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The stock market turned down sharply on Friday and is now heading towards a possible bounce around the SPY 89-day moving average at 448. With the negative news build-up over the long weekend, we could easily have a panic crash on Monday. In any case, a sharp short bounce worth trading to the upside can be expected early next week. But what happens over the intermediate term is anyone’s guess. Another problem is the widespread expectation of a Santa Claus Rally which may be a dangerous assumption. You need to remember the alternative case of December 2018.

Key underlying short-term timing indicators show the following:

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NYSE McClellan Summation Index: This indicator has broken down and is one trading day away from a possible “oversold” condition. In the past, this indicator has shown the ability to stay oversold for many days, but recently the bottom of the market has occurred shortly after entering this oversold territory. So be ready to move soon if you’re willing to risk playing the trading game.

Fear/Greed Index: This popular indicator is in the “Fear” territory after having been in the “Greed” area for some time. Friday’s sharp down took this indicator down quickly from a reading of 64 to 31 which is the largest one-day drop that I can ever recall. One or two more negative days and this indicator will be in the “Extreme Fear” range which is a precondition for a bottom.

WALL STREET CRAPS STOCK MARKET STRATEGY SEPTEMBER 7, 2020

September 6th, 2020 Comments off

craps front coverSTOCK MARKET STRATEGY FOR SEPTEMBER 7, 2020: The stock market had a fresh break to the downside this past week. Could this be the long-awaited correction that will take us into October? Or will this simply be a “dip” to buy for another rally to new all-time highs. The NYSE McClellan Summation Index reading tells us to be very careful here – things can change quickly in this environment.

Key underlying short-term timing indicators show the following:

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NYSE McClellan Summation Index: This key trend indicator remains below its 15-day moving average with a chance of expanding to the downside. Because of this indicator, a trader/swing trader should be very careful about waging too much capital on a long-side bet.

WALL STREET CRAPS STOCK MARKET STRATEGY AUGUST 22, 2020

August 22nd, 2020 Comments off

craps front coverSTOCK MARKET STRATEGY FOR AUGUST 22, 2020: The stock market is hovering near its all-time highs in many indices. But the real strength has been in large tech companies like Apple, Google and Amazon. I suspect there will be one more rally coming soon since some indicators are showing “oversold” reading today.

Key underlying short-term timing indicators show the following:

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NYSE McClellan Summation Index: This key trend indicator broke below its 15-day moving average on Friday which has been an early sell signal in the past.

WALL STREET CRAPS STOCK MARKET STRATEGY JULY 12, 2020

July 12th, 2020 Comments off

craps front coverSTOCK MARKET STRATEGY FOR JULY 12, 2020: The stock market is near the top of its trading range. After a large gap down last month, the market has held its own for a few weeks now. The question is whether the market will fill that gap soon or head down from here. In any case, it does not appear that a new All-Time High is likely or if it does reach a new high – that will mark the end of the rally since March 23rd.

Key underlying short-term timing indicators show the following:

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THE BOTTOM LINE: The stock market’s internal indicators are reading “neutral.” This means that it could go either way from here. The move that I think may happen is a new closing high to fill the June gap, but that high marking the top of this move since March 23rd.

WALL STREET CRAPS STOCK MARKET STRATEGY JUNE 16, 2020

June 17th, 2020 Comments off

craps front coverSTOCK MARKET STRATEGY FOR JUNE 16, 2020: The stock market made a sharp move downwards on last Thursday and has recovered much of that decline over the last 3 trading days. This sets up the possibility of a Classic Dow Theory and Granville Non-Confirmation sell signal on the next closing high in the Dow Jones Industrial Average. This new unconfirmed high could mark the end of this powerul rally since the March 26th bottom.

Key underlying short-term timing indicators show the following:

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THE BOTTOM LINE: The stock market is setting itself up for a possible sell signal on the next closing high in the Dow Jones Industrial Average. That new high would be unconfirmed by the majority of other indicators and particularly the Dow Jones Transportation Average which would need to rally substantially in the next few days. Note: The next closing high may even have one or two additional days to the upside with each day being progressively weaker and more selective.

WALL STREET CRAPS STOCK MARKET STRATEGY MAY 7, 2020

May 7th, 2020 Comments off

STOCK MARKET STRATEGY FOR MAY 7, 2020: The stock market has been hovering in a tight trading range for the last couple of weeks. During this time, a few of the internal oscillators have come down to the “oversold” range. That brings the possibility of a short-term bottom in 2 to 3 trading days if the trend continues down. But be careful of a potential crash, too.

Key underlying short-term timing indicators show the following:

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THE BOTTOM LINE: The stock market is approaching a possible short-term buying opportunity as the internal indicators move down to oversold readings. But a trader must be careful not to jump the gun since there could be a downside break with momentum or a possible mini-crash.