We had a mixed day for a change today with the Nasdaq & Russell 2,000 up, S&P 500 flat and the Dow down. It's tough to get excited about the strength in tech and small caps since so many stocks are just stuck in ranges. I saw a lot of bullish reversal candlesticks when I ran through my scans tonight but almost every one of those stocks was in the middle of congestion. Good risk/reward swing trades are hard to some by right now, at least for the type of setups I like.
I feel the same way about the indices. They seem to be coiling (building triangles) right now. The Nasdaq has to get through its 50-day moving average before it can get a whiff of the potential resistance at the top of the triangle. I don't see much to do with this index until it's free of the top of the triangle or below the January lows.
The S&P is a bit further away from its 50-day moving average but otherwise it's the same story as the Nasdaq.
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Long-Term | Down | Down | Down |
| Intermediate | Down | Down | Down |
| Short-term | Lat(+) | Down | Lat(+) |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I'm simply using the indices' relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
Mike, I've been having problems with the emotional aspect of my trading. i read Trading in the Zone which was helpful. Do you prefer "The Psychology of Trading" or "Enhancing Trader Performance"? thanks
Hi Tony,
My answer would have to be "Enhancing" b/c I haven't read "Psychology of Trading". I just re-read "Trading in the Zone" periodically and listen to my trading affirmations CD. Dr. Brett has a new book coming out next month, "The Daily Trading Coach: 101 Lessons for Becoming Your Own Trading Psychologist", which you may find helpful. I've head an early version of that and liked it a lot.
Good luck,
Mike