We are coming close to end of the month and barring something unexpected, it will be a positive January. So we have every Jan. indicators positive. On the flip side, my upside target for SPX was 1510 and we have come few pennies away from that target. If we can close convincingly above 1510, then the next target is 1530. But I have my doubts that it will happen anytime soon.
Today SPX gave up about 6 points but still managed to close above 1500. As if it is now acting as a support. And I think it will move around this level (1500-1510) for a while.
Folks are now actually getting bullish. It seems retail investors are now returning to the market and are talking about their portfolio. I wonder at what stage of the sentiment cycle we are at.
Yes, I know, calling a top is fools errand and that's why I am not suggesting that we should short now. I am suggesting that we wait for confirmation for price action either way and wait for sell signal. As of now, we do not have any sell signal and the bull case is still strong. But again, it is late in the game to join the dance. May be we will be asked to shut the lights off because we would be late in the party. So better to wait and watch. Remember last Jan/Feb? Everyone was calling for top and shorting the market, only to get killed. This year is more of the same.
Commodities are also not doing much, just moving in a range. Today's spike in gold and silver is not convincing enough to go long again and it looks more like a pump and dump action. Till gold closes above$ 1700 and stays there, we could see more correction in prices.
Oil on the other hand can go up a little more but not much juice left for now.
All in all , we need to remember how to be patient in this market.
Good luck trading, folks.
Today SPX gave up about 6 points but still managed to close above 1500. As if it is now acting as a support. And I think it will move around this level (1500-1510) for a while.
Folks are now actually getting bullish. It seems retail investors are now returning to the market and are talking about their portfolio. I wonder at what stage of the sentiment cycle we are at.
Is it at the Hope stage? I don't think so. I think we are somewhere between Thrill and Wow, I am smart stage. And if my reading is correct, then we would chop around here a bit before a decent correction. Yes, I know that would be the fodder all the doomsdayers are waiting for but my Crystal ball can't see beyond next few months and can't tell me whether this is minor top or major top.
Commodities are also not doing much, just moving in a range. Today's spike in gold and silver is not convincing enough to go long again and it looks more like a pump and dump action. Till gold closes above$ 1700 and stays there, we could see more correction in prices.
Oil on the other hand can go up a little more but not much juice left for now.
All in all , we need to remember how to be patient in this market.
Good luck trading, folks.
