Darn! As I wrote and posted here earlier in the day, we are flat! That poses problems for next week.
For those of you that missed my earlier column:
A nice dip today would be good for bulls.
A flat day would evoke bad memories.
The old patterns have to be broken.
In the bear market days of 2000-2003, we had three-day wonders: A big up day followed by a flat day, then another big up day. Then we had the total collapse. We had that pattern a half-dozen times.
It's pretty clear in retrospect that we had shorts who battled on day one, battled day two and gave up on day three. Once the shorts were covered, we had no ammo left to take things higher, and they collapsed of their own volition.
Obviously, a better pattern for the bulls would be a nice decline today, a decline big enough to bring more people in but not so big as to break the new trend. Conversely, a flat day would be too reminiscent of that old pattern. And an up day would be a huge question mark, because that would signify something truly remarkable: big gains that were sustainable and capable of being built upon without the help of shorts.
I say this because I saw very little short-covering Thursday. We went up naturally and gingerly over the course of the day. It would be just as "natural" to come down a bit today as traders took profits.
So in a bizarre way, as someone who is way long, the only thing I don't want to see is, well, nothing. That's the old pattern, and it needs to be broken.
I know what you are thinking. I shorted heavily (based on my own capability) and thought that JNPR will go down but apparently JNPR has stronger support than I thought. That's why I have a change of heart and to cover it back. I am going long but it won't be a large volume today. I am going in maybe about 300-500 shares range to test and see how it will hold. If I am wrong and get stop out on my mental limit, I will quit playing JNPR for a while.
You know Zen,
I don't have the heart to go long here at 25.80 or so. I can't pull the trigger here with a good conscious. I'd rather just ride up what I'm long in already and cash out soon.
Yes, I am seriously going to go long today. Today's my day-off and I can stay home to monitor the trading activity whole day without having to worry about work.
Call me crazy but even thought I read charts, I pay more attention to momemtum than those gaps except the major ones. I believe the gaps are there but when majority of the players think that they are going to be filled, then I will see that momemtum build-up towards that gap in the chart.
Yes you are right. I just had to reply.
So you're seriously going to long today?
I was pondering it myself but I think it needs to fill the gap a little don't you think?
In fact, don't you think the nas needs to retest some levels from here???
"I know the dollar is declining, and oil is worth something but gold is useless."
It is true that oil is worth something but in terms of trading vehicle, oil is not the ideal tool for trade. Oil is the end product for consumption whereas gold is the intermediary tool that is portable to be carried around for trading with other consumables.