Market commentary for 02/06/2009
Good day!
One lesson what I learned from my teach masters is that cash is position and that can be best position sometime. After very wild market action I think that is good option for Friday. On the 60 min chart we can see very sharp moves in both directions without follow thru what increase trading risk. On the DIA 60 min chart forming triangle and right now I don’t have idea where will break. All bigger time frame charts support down trend but we also have big divergence between DIA and QQQQ daily charts. There are several reasons why trading risk is high. Divergence, sharp moves without follow thru, news what we are expecting from congress and I believe that will be smart to step aside and wait few days to see some continuation signals. I know that we can miss initial move, but also I know that market can fake us several times before will take direction and at the end it is questionable will initial move back that losses. If you want trade, my advice is to do that with small risk and to use small time frames (scalps, max day trades). My bias is still downside on the bigger time frames and I will respect that, so for now extra caution on long trades.
Wish you all good trading!!!
Kind regards.
Ivica
Danded2005@inet.hr
Good day!
One lesson what I learned from my teach masters is that cash is position and that can be best position sometime. After very wild market action I think that is good option for Friday. On the 60 min chart we can see very sharp moves in both directions without follow thru what increase trading risk. On the DIA 60 min chart forming triangle and right now I don’t have idea where will break. All bigger time frame charts support down trend but we also have big divergence between DIA and QQQQ daily charts. There are several reasons why trading risk is high. Divergence, sharp moves without follow thru, news what we are expecting from congress and I believe that will be smart to step aside and wait few days to see some continuation signals. I know that we can miss initial move, but also I know that market can fake us several times before will take direction and at the end it is questionable will initial move back that losses. If you want trade, my advice is to do that with small risk and to use small time frames (scalps, max day trades). My bias is still downside on the bigger time frames and I will respect that, so for now extra caution on long trades.
Wish you all good trading!!!
Kind regards.
Ivica
Danded2005@inet.hr
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