Has the recent correction from March 2009 come to an end?
My friend Adam thinks so and he put together a video for you explaining why. He looks at the crash of 1929 and the similarities to today's Dow.
I disagree with Adam.
The old going back to 1929 Dow myth is used by bears every time the market corrects.
Technical analysts call this grand cycles or super cycles. I say it's grand BS. If you have to go all the way back to 1929 to rationalize why you think the market is going lower...
Look, what happened in 1929 has no impact on what is going on today. Take a look at the Fibonacci retracements on the Dow.
We have not even surpassed a minor 23.6% Fibonacci retracement yet which is 9749. In fact, as long as the 61.8% retracement holds (8136), the March uptrend is intact.
Remember Dines Theory of trend trading: "A trend will continue until that trend actually ends. On days a market trades sideways, assume continuation of the previous trend."
In other words, it's premature to say that the uptrend that began in March 2009 is over simply because of a 23.6% retracement.
I still recommend that everyone sit in cash until the retracement is over. For more aggressive traders like myself, I'm back in now as I believe the typical seasonal sell off after the Santa Claus rally is mostly over. But I'm not back in with both hands. I have a single stock (IDN) that I like the prospects of and I'm going to swing trade it with very tight stops.
Nevertheless, I want you to see Adam's video to give you another opinion. Weigh my opinion and his opinion, then form your own.
Has the recent correction from March 2009 come to an end?
My friend Adam thinks so and he put together a video for you explaining why. He looks at the crash of 1929 and the similarities to today's Dow.
I disagree with Adam.
The old going back to 1929 Dow myth is used by bears every time the market corrects.
Technical analysts call this grand cycles or super cycles. I say it's grand BS. If you have to go all the way back to 1929 to rationalize why you think the market is going lower...
Look, what happened in 1929 has no impact on what is going on today. Take a look at the Fibonacci retracements on the Dow.
We have not even surpassed a minor 23.6% Fibonacci retracement yet which is 9749. In fact, as long as the 61.8% retracement holds (8136), the March uptrend is intact.
Remember Dines Theory of trend trading: "A trend will continue until that trend actually ends. On days a market trades sideways, assume continuation of the previous trend."
In other words, it's premature to say that the uptrend that began in March 2009 is over simply because of a 23.6% retracement.
I still recommend that everyone sit in cash until the retracement is over. For more aggressive traders like myself, I'm back in now as I believe the typical seasonal sell off after the Santa Claus rally is mostly over. But I'm not back in with both hands. I have a single stock (IDN) that I like the prospects of and I'm going to swing trade it with very tight stops.
Nevertheless, I want you to see Adam's video to give you another opinion. Weigh my opinion and his opinion, then form your own.
Has the recent correction from March 2009 come to an end?
My friend Adam thinks so and he put together a video for you explaining why. He looks at the crash of 1929 and the similarities to today's Dow.
I disagree with Adam.
The old going back to 1929 Dow myth is used by bears every time the market corrects.
Technical analysts call this grand cycles or super cycles. I say it's grand BS. If you have to go all the way back to 1929 to rationalize why you think the market is going lower...
Look, what happened in 1929 has no impact on what is going on today. Take a look at the Fibonacci retracements on the Dow.
We have not even surpassed a minor 23.6% Fibonacci retracement yet which is 9749. In fact, as long as the 61.8% retracement holds (8136), the March uptrend is intact.
Remember Dines Theory of trend trading: "A trend will continue until that trend actually ends. On days a market trades sideways, assume continuation of the previous trend."
In other words, it's premature to say that the uptrend that began in March 2009 is over simply because of a 23.6% retracement.
I still recommend that everyone sit in cash until the retracement is over. For more aggressive traders like myself, I'm back in now as I believe the typical seasonal sell off after the Santa Claus rally is mostly over. But I'm not back in with both hands. I have a single stock (IDN) that I like the prospects of and I'm going to swing trade it with very tight stops.
Nevertheless, I want you to see Adam's video to give you another opinion. Weigh my opinion and his opinion, then form your own.
Stocks Above I Currently Hold In My Own Trading Account: Long LIFE
Guerilla Trader Quote
“Never buy a stock because your emotions tell you that you might be missing a chance to make money. This is the wrong reason to buy a stock and is the #1 reason people chase stocks.”
Copyright 2009-2011 GuerillaStockTrading.com All rights reserved. No part or article on this website may be copied or duplicated without written consent from GuerillaStockTrading.com and Confab Publishing. Disclaimer: This Web site is designed to provide accurate and authoritative information on the subject of personal finances. It is provided with the understanding that neither the author nor the publisher is engaged in rendering legal, accounting, or other professional services by providing this Web site. The authors and publisher shall not be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential or other damages. As each individual situation is unique, questions relevant to personal finances and specific to the individual should be addressed to an appropriate professional to ensure that the situation has been carefully and appropriately evaluated. This blog is for information and entertainment purposes only. Under no circumstances does this information represent a recommendation to buy or sell securities or any other type of investment instruments. See a licensed broker for investment advice.
Guerilla Stock Trading University