Tuesday, January 27, 2009

Today's market wrap up

The S&P made what is commonly referred to as a "inside day." Virtually all of the trades placed today were priced within the highs and lows of yesterdays activity. This might be a good thing for us right now but I am not really sure.

There is something called a Volatility Index that measures.... well.... market volatility. Its symbol is $VIX. Many like to think of it as a index of fear. Since that number has fallen about a percent over today's market activity, traders must be a percent less fearful. Less fear and more stability are good things.

Since fear is down a little, the overall market was able to make a little bit of gain today. That's a good thing! On the other hand, the market has not been able to regain the strength it had the day before the new President was elected. Since few traders have confidence in his ability to create beneficial change, fear is still at a pretty lofty level.

The market made three highs and two lows today, the third low is currently being formed. In 20/20 hindsight, I wish I had traded each of those peaks; a Market-Fu Master would have. Instead of ending the day with a single small gain on the books, the theoretical Market-Fu Master would have five nice gains in his wallet and a small (similar to mine) gain on the books. If those five gains were about two percent each, he would have ten percent more cash to invest tomorrow. Consider the power in this!

The market is a wonderful place for those who understand Market Tao.

Back to my reality:
My Google investment is still up a percent and my RTP is even. I am hopeful for more from each of them for different reasons. They are both testing daily high resistance points and RTP is forming a nice "saucer" pattern on the daily chart.
RTP is experiencing more (another) resistance at the 20 period Moving Average. Since it has been consolidating for two weeks, I hope it is about to explode.

Wow! that sounds pretty technical!
In fact, it is. Nothing I have said above refers to stock fundamentals. I am confident that in this market, the fundamentals of these stocks (and many others) are pretty good since Price is improving.

I learned about technical analysis from reading books, personal experimentation, and watching many hours of the videos posted on the web. Most of the free trading videos that offer instruction in Moving Averages, Support, Resistance, and such, are consolidated into one aptly named website: Free Trading Videos.com. That site is important enough to me to add their link in this blogs sidebar.

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