Market Paused At Important Spot With Big News Setup

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August 31, 2010

The market is sitting right at the same boring level it has messed with traders for the last 4-5 days. Right at 1050 SPX.

With so much news coming out overnight and tomorrow you would think it would be stupid to have a trade on in front of it. Well I don’t trade the news. Never have.

What I’ve learned is that news doesn’t matter. Well it matters sometimes, but that is such a rare occasion when it can change the trend.

The trend is down. News flow no matter what the positive or negative aspects of that news should ultimately give way to the trend.

There is a chance though that something like the 21dema gets tested before making that new low. I will most likely cover my shorts if that starts to happen as I am not good sitting through pain waiting for a larger theory to unravel. Even though that is how the market often acts when trend trading.

Currently short heavy the 2x inverse, TZA, and EDZ.

If the market closes anywhere lower than today, or even opens lower or moves lower or anything lower than today’s close…I’m looking for 1020 SPX.


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  • Bill

    still stuck in no mans land. how much longer is this market going to jerk traders around???… maybe still have to suffer through a few more headfakes before this B.S. is finally over… sigh…

  • http://www.stockrake.com StockRake

    Worried about one more jerk around, up and down and on that down I hope I’m not sick of the market to catch it. I see the futures are up 1% now ah. I assume I’m not the only mentally exhausted.

  • Bill

    You definitely aren’t the only one. I need a vacation from this torturous market…

  • http://www.stockrake.com StockRake

    One of the things I was commenting to my friends yesterday is that although being right on the downside it has yielded little satisfaction.

  • Bill

    The dip buyers continue to lead charmed lives. Buy every dip and come out smelling like a rose. Meanwhile the trend followers get screwed over again and again and again…

  • stoxtar

    It happens to the best of us. I guess I should ask: Are you still holding SHORT or did you cover?