Hi Guys,
Markets have made a strong run to start 2012 and now risking to give up the entire yearly gains. As i write this, the market is getting quite OVERSOLD short term but as we have learnt by watching this market last few weeks, OVERSOLD can STAY OVERSOLD and even get more OVERSOLD. So trying to be a hero is NOT advisable right now.
Some are thinking add longs. Some are thinking add shorts. I am thinking, just chill for right now and waiting for the absolute BEST setups. Keep trading time frame very small. Most of trades these days end up being DAY TRADES and my swings tend to last less then 48 hours). It's hard to look out and anticipate what will happen 1-2 weeks out. We managed to get thru the month May with gains but i am a little disappointed as my short setups lists worked very well all month but i did not capitalize on them as well as i would have liked.(hindsight is a beautiful thing in the trading world BUT no one is perfect in the end and you will NEVER catch every move no matter how hard you try!)
Now comes the tough part where the indexes get into OVERSOLD territory but so many setups have got destroyed as 'panic selling' is ruining many charts. All this damage will take a long while to get it fixed.
I say take it easy and allow this market some time to prove itself and for the dust to settle before we start to attack positions again. Once the market starts to 'ignore' bad news and moves higher on "bad news" that'll be our first cue that a short term bottom is getting close.
I will give you advice which i used to hear all the time when i was first starting out in this trading business and it's advice at the time, i took for granted but now i see it's wisdom: LESS IS MORE. it's simple.
LESS IS MORE.
cheers
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