These Charts Have The Bears Chomping At The BitDon't Be Fooled By These Long Term ChartsThe Market Is Showing A Tremendous Amount Of ResiliencyGetting Started Is Easyfzorrilla@zorcapital.comimage
The charts underneath show clearly the recent deterioration of breadth that have the bears chomping at the bit thinking that market a pullback is inevitable. On the flip side the bulls believe that it is only a matter of time before the indices pull all the lagging stocks up and give us a rising tide lifts all boats situation. Time will tell, but it is easy to see why both camps are so adamant.Here we have the Russell 2000 versus stocks up 25% or more for the quarter and stocks down 25% or more for the quarter. You can see [...]
Anytime stock market studies are done the results or the outcome are plotted on a long term chart of usually the Dow Jones Industrial Average or the SP500. It might be a breadth study, sentiment, average intra-year draw-downs, average yearly gain, etc...Any and all negative studies plotted on a long term chart will look as a non-event, every correction will also look like a non-event, and because you are looking at history and know what the end result is that will give you a false sense of security that you can withstand any and all corrections and everything should be [...]
Over the weekend quite a few people pointed out some of the negative divergences that they are seeing. As usual those who point them out are perceived to be short the market, under invested, perma bear, etc....This might be the case or may not be the case, you never know with twitter, but divergences are divergences and what you do with the information is more important.I'm in the camp that 99% of negative divergences in a bull market should be ignored and or be left to those who are nimble in the short term. For the rest (majority) one should [...]
Many traders believe that how you manage a trade is the most important part of a trade, and I agree. But, to me, entries matter and they are important. In the video below I share a tip on how to save tremendous amount of money and emotional capital as a swing trader.Getting Started Is Easy
There is a big difference between a company and its stock. Many times stocks that are extremely overvalued go on short term runs that defy logic, such is the case with many new companies. In the video below I pin point what to look for before you jump the gun and short an over-hyped IPO. Getting Started Is Easy
Before you jump the gun and call it quits on the market based on a tough week for the market, I want you to know a few things;1. Since 1980 the average intra-year decline in the SP500 has been roughly 14%. 26 out those 34 years despite the average intra-year drop the market closed positive, 76% of the time. That does not mean that the declines were not painful, its just a reminder that the market goes UP and DOWN not up OR down. And, draw-downs are unavoidable, there is no sense in trying to avoid what cannot be avoided.2. [...]
Right here, right now, if you go through all the Chinese names you will notice they are all gapping down pre-market. All of these stocks seem to me as they are stretched to the downside here in the short term (1-10 days). And, this pre-market gap down feels more like a short term exhaustion move than a continuation of the trend of the last month.Getting Started Is Easy
Based on the recent market action its hard to make a case to buy an up opening like we are walking into today. Greece is still acting as an overhang but the real issue might be what's going on in China, will it have any spillover effect is the question.Biotechs continue to standout while most other sectors continue to struggle. For the first time in a while we have more stocks down 25% for the quarter than up 25% for the quarter (Stockbee Indicator) all this while the indices are a stone throw away from all time highs.We have seen [...]
There are a million ways to make money in the market, at the end of the day there is no right or wrong way. Today, Carl Ichan showed the world how he made over $2.1 billion dollars on a $321 million dollar investment. Carl bought $NFLX in late 2012 when the stock was in a downtrend, near its 52 week low, he sold it today as it traded at all time highs. Buying stocks near lows and in downtrends goes against what every trading book and trading guru advises you to do. Carl made over 1000% doing the exact [...]
