This is a very humbling game ---for example I could not
explain to my Dad why we currently have 92% of stocks above their
50 DMA. I really have no idea given all the economic and political
problems out there. Is it just me ?
opposing forces that are affecting the market right now.
On the one side we have overburdening debt coupled with aging
and entitled populations, and on the other we have
crooks, politicians and governments doing everything possible to
try to keep the population happy or at least delay the problem long
enough that it hopefully becomes less of a problem. (If that's even
possible.)
So how do we deal with it as traders? Well, it may well
turn out that your thinking is absolutely correct about the long
term.
Since I frequently find myself in a similar dilemma, I
have a note taped right to my laptop. It says
"Think big picture but trade the small
one".
Posted by billnew52 on 24th of Oct 2011 at 08:49 pm
Meaghan,
The market is much (if not most) about psychology. We can
focus on the negative only so long and then we look for the
positive - regardless of whether it is there or not. Only
time will tell in any event. Regarding why so many individual
stocks are above their 50 dma - everything had fallen so
precipitously, and then rose again at such a steep incline in a
short period of time. The 50 DMA just kind of got left
behind, or sunk below the price. It will, however, catch up -
and perhaps with a vengeance.
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50 DMA
Posted by meaghan on 24th of Oct 2011 at 07:59 pm
This is a very humbling game ---for example I could not explain to my Dad why we currently have 92% of stocks above their 50 DMA. I really have no idea given all the economic and political problems out there. Is it just me ?
That's because it's a very difficult question. There are just too many
Posted by johnc on 25th of Oct 2011 at 06:38 am
opposing forces that are affecting the market right now. On the one side we have overburdening debt coupled with aging and entitled populations, and on the other we have crooks, politicians and governments doing everything possible to try to keep the population happy or at least delay the problem long enough that it hopefully becomes less of a problem. (If that's even possible.)
So how do we deal with it as traders? Well, it may well turn out that your thinking is absolutely correct about the long term.
Since I frequently find myself in a similar dilemma, I have a note taped right to my laptop. It says "Think big picture but trade the small one".
That keeps me focused where I need to be.
50 dma
Posted by vincielehman on 24th of Oct 2011 at 10:59 pm
Economy sucks but companies are flush with cash and are profitable main street vs wall street - divergence - IMHO
A few thoughts
Posted by billnew52 on 24th of Oct 2011 at 08:49 pm
Meaghan,
The market is much (if not most) about psychology. We can focus on the negative only so long and then we look for the positive - regardless of whether it is there or not. Only time will tell in any event. Regarding why so many individual stocks are above their 50 dma - everything had fallen so precipitously, and then rose again at such a steep incline in a short period of time. The 50 DMA just kind of got left behind, or sunk below the price. It will, however, catch up - and perhaps with a vengeance.