Tuesday, June 16, 2009

What Goes Up Must Come Down - Blood Sweat & Tears

The market as of late has been moving to the upside punishing those who did not believe that it could bounce and could not "Spare a Square."(Love Seinfeld.) Now we are faced with the fact of do we move higher or did we just witness one heck of a Bull Run in a Major Bear market. One thing is to reduce the noise factor as every talking head chimes in on how Dow 14,000 is just a few weeks away and the recovery is here. Amazingly those same talking heads declared the recession about 6 months late and seem to want to make up for it by letting you know that it is time to buy. I tend to take somewhat of a contrarian view on the whole matter. When the media declares that it is time to buy, you are late to the party and all the Hunch Punch is gone. At the same time when the market was in a death spiral the media then was telling us to stay on the sideline and do not risk anymore loss. Note to self do not listen to the media. Now the market has made a fantastic move to the upside, reevaluation is at hand and hard stops on those profitable trades is a must. If you think of trading as mechanical and less emotional,(tough to learn) you will benefit greatly from the market. Another clue as when to pull the plug, is when leaders of the market struggle to make new highs (BIDU, GOOG, CME, ISRG, AAPL,RIMM)then the rest of the market starts to rollover. I think it is best to say that now that we have had a move up, it must come down, Spinning Wheel got to go round, Talking about stock doubles is a crying sin, Ride a rigged option, Let the spinning wheel Spin......

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