29
Oct
stored in: Technical Analysis and tagged:

That’s my reaction to what transpired over the course of today. Coming into the open I felt like a continuation from yesterday’s irrational exuberance may take the markets temporarily higher and then the bubble would pop, sending the markets lower. I was really hoping for a big gap up to take out the rest of my long ETF’s, and then I would consider going short, but that play never materialized. The markets did a whole lot of nothing up until the Fed met, and then it was off to the races. At one point right near the close I left my hotel room for 3 minutes and when I left the Dow was up like 260, and when I returned it was down 60.

Absolutely amazing. Now I’m not a pure day trader, but I’m beginning to think that they are the only people making money in these markets as these swings are impossible to trade. I don’t even understand how nearly a 400 point move can take place in what was basically minutes. I was reading an article in the Financial Post last night and it was saying how hedge fund redemptions will be selling stocks into every rally in order to get cash to meet redemption requests. This should keep the markets under pressure for quite awhile.

Here’s something else to consider. We’ve had 2 of the best point gains on the markets in their history, and as of today’s close we are still down 1859 points. My personal indicators are close to giving a green light to go long on equities, but it will take a strong close tomorrow to seal the deal. Should we head back down from these levels then the trend will remain down and I’ll be looking to go short in the afternoon session tomorrow. I really doubt I’m going to do much trading in the morning as conditions are so volatile and I get my signals on closing prices.

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