Market Update for The week of August 19,2013
Posted: Sat Aug 17, 2013 1:37 am
I normally would go ahead and write a nice article here discussing market conditions and where I see the markets moving in the next 5 trading days, This has been done consistently for at least the last 12 weeks, but now i would say we have come to a time in the markets where technical analysis take a back seat to some Geo-political news. Another important thing you will hear me say over and over again is you won't find a better way to capture profits in the market the the HPS methodology except when I put up the red flag! And a red flag is due to some news that the market was not expecting in this case a fast escalation of violence in Egypt. The severity we haven't seen in years. Snipers are killing news correspondents and children. It could be that Egypt is on the brink of a civil war. So now we have two opposing signals. The markets have now rotated back down from recent overbought levels 1709 in the S&P 500 and have gotten oversold on both the daily and 60 minute time frame. This normally would be a extremely bullish area for me, but because of the uncertainty of events that could happen very soon. I would remain extremely cautious and even though we have great set up that qualify for HPS. There is no guarantee the market reacts to the signals.
Sunday we might have a better picture..Futures open at 6:00pm est (you can see them here on DTR) And if there has been no further deterioration in events around the world I would say Tuesday will be the day to watch for that move back up possibly Monday. Either case I have some awesome set ups and new HPS stocks on the watch list. $KO leads them off and it only gets better. OXY also is key at the lower channel line.
This could be a great week or a big wash. One thing for sure the stocks on this week's HPS from a-z are all set up and even if the market broke down these are the ones that will come back fast. I will be keeping things small but will look to add to the ones i am holding as now. For the last 2 weeks I have cut back on my size normally starting off with 100 to 300 share I have step in with 50 share position and in these HPS not holding anything more then 200 shares and in most cases 100 shares. Monday I will have to see where we stand and decide if I want to lighten up or press.
My call is this will be an opportunity when we look back 2 weeks from now, I expect one more push to new highs and then a correction.
Chart Larger Image