Wednesday, April 15, 2009

Mixed signals in the market

Once again market went up higher for no particular reason whatsoever with a lighter volume than yesterday but still a decent volume. Probably a lot of money is coming in the market through retirement funds, some of which kicks in around April. I couldn't get my kickout price today so I remained 100% invested - a really bad mistake considering what is going on with my indicators. Since volume is turning out to be of no use in this market we can only trade on short and less short term price trends. I looked at charts of past 6 months since the market went into turmoil, and I could find that only 2/13 was consistent enough to have avoided whipsaws and still make money. Otherwise I am giving up all my gains in the whipsaws. I will keep my exit at 13-day MA and adjust to $21.44 for tomorrow. I will be adjusting the kickout price everyday to the 13-day MA. If market takes me out then, thats fine, and I will try buying SDS if volume is convincing. I am not going to worry about it too much. I will just do technical trading of SMA 2 piercing SMA 13 in either direction. I don't want to use complicated indicators since they have disadvantage of being complicated.

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