I’m going to be taking the time this weekend to reflect on developments in the market while its closed. What a relief.
I’m going to do a bit of ‘sleeping on it’.
Since the FOMC I have been a bull (but a bit tempered yesterday).
There are a number of things now that are prompting me to reconsider.
The price action is not the least of them.
What is it at 1185 (and thereabouts)? Big wall of selling. Is it just the wall of worry, to be overcome as the absorption plays out? Maybe. Don’t know.
On August 5 I wrote a post titled: “The study of responses … is an almost unerring guide to the technical position of the market.” That’s not just a post title, its a gem from Wyckoff. It bears (no pun intended) thinking through. For a trader, its like carrying around a permanent ‘get of jail free’ (or at little cost) card. How valuable is that!?!
So, I’ve been very bullish since the FOMC … but … I am searching for the right word … ‘concerned’ will have to do (though its not quite right) about the price action on the highs (and specifically around that 1186 level). The response does not seem consistent with a market that’s going to go higher. I don’t know, which is why I will be using the weekend to have a think (while doing & thinking about other things, which I find is a great way to allow my brain some space and time to think about the market).
So, I’m putting the bullishness on hold, and will see what I am thinking on Monday morning. Great thing about having a short-term perspective and being free to change view as required.
Found this, bolding mine:
George Soros, “I think that my conceptual framework, which basically emphasizes the importance of misconceptions, makes me extremely critical of my own decisions.” I know that I am bound to be wrong, and therefore more likely to correct my own mistakes.“
Found here: http://www.mebanefaber.com/2011/08/09/all-that-had-changed-was-people%E2%80%99s-opinion-of-the-place/
This is much more useful, and so much more relaxing, than being one of those who always needs to be right (no matter how long it takes the market to come around LOL).