Thursday, January 18, 2007

Holy Cow

Wow, what a difference a few days can make in the market. Over the weekend I was excited. There were plenty of quality stocks setup and ready to go. I thought, given one more week, the underlying strength of the market would match that not seen since 2005. But the last two days has brought heavy selling on heavier volume, not good. I have to move to a neutral position and become cautious on this market. This could turn out to be nothing more then a massive shakeout, which would make sense, but until we know, no need to initiate any new positions. Sell any laggards or stocks that have made very little progress. But make sure to do the research. If this turns out to be a shakeout during an options expiration week, then next week could bring good tidings. The only consolation I can find, it took quite a bit of bad news to get the market to finally have a massive down day. The kind of bad news that usually accompanies capitulation. In the meantime, no reason to be fully exposed.
Post a Comment