The Great Sell-Off

Oh my... I didn't witness it happen but I certainly heard stories about it (which made it more EPIC). When I woke up around 12:40 pm (Yes, I overslept), my sister immediately told me the slaughter that occurred during yesterday morning's trading. The market was up around 30 points. One would think, "Oh, such a strong market!" I talked to a fellow trader later on and he was saying and I paraphrase, "Given that the Dow futures and other Asian bourses were trading at the red, you'd think that buying into the market held no, if not little risk."  Had I been awake during trading, I probably would have bought something! It turns out, everyone realized we were too bullish and took this as a time to  take profits. This was at around 11 am. It all went downhill from there. We closed the day 22 points lower. BTW, this trader friend of mine said he'd be taking a vacation until Friday. What an exhausting market! 

In my previous blog entry, I sounded so optimistic...Oh boy, was I wrong. Haha! I actually realized that on the 14th when cut loss on BDO, MBT and....drum roll, please...CMT. :)) Let me tell you a little secret. If I don't post a blog entry for the day, that could mean either of two things: 1) I'm busy or 2) the market is discouraging. These days, if I don't post, it would be safe to assume the latter. Hahaha! For the record though, I didn't post anything last Monday because I fell under silent choice #3: All of the above. I was both busy and the market was discouraging. Like I said, I cut on three issues that day. This made me realize I needed yet another break.

Here's why I'm worried with the market: 

Although we can't confirm it yet until a convincing break below support of 3,873, don't you think this chart looks a bit, if not entirely daunting? Don't even get me started on selected issues! :P Back to the index, we are currently consolidating within a narrow range, and close to the index's downtrend line. I would only suggest a buy on convincing breakout above this narrow consolidation. For the meantime, stay out. Afterall, the medium term trend is down even though the short-term trend is up. It's all about probabilities and we prioritize the longer term trend to determine the strength of the current trend. I hope these all made sense. And that you still have some sort of regard for my opinions even though they come from the girl who changes sentiment every other day. :P I guess all I'm saying is, we're not yet out of the woods. It's during these trying times that I'm thankful I was educated and trained to appreciate a cash position.