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Index Outlook
Market is decidedly in an up-trend above the 8 ema which tells us that market sentiment is bullish. We saw healthy consolidation Friday of Thursday’s larger move and we have been seeing the market dribble up for the past two weeks. While many traders continue to try to call a top, we can easily continue to consolidate any over-bought condition in a sideways pattern as we have been seeing.
Any lower low, lower high today will likely be a healthy pullback in current market conditions, as long as we stay above the 8 ema, but that doesn’t make it time to go long as pull backs in bullish markets can easily last 1-3 days. In order to buy the dip, we will wait for the uptrend to show itself with a higher high and higher low following the pullback. This is the signal we need in order to know that market sentiment has not turned to the downside
Ryan Mallory is the co-founder of SharePlanner Inc, a financial website devoted to Day-Trading, Swing-Trading (both long & short) and exchange-traded funds. Ryan makes a strong emphasis on risk mitigation strategies, trading transparency, and trader education – not to mention a great set of stock screens as well.
Be Sure to Check out Ryan’s Site at Shareplanner.com
2012-08-20 08:21:41
Source: http://www.shareplanner.com/market-thoughts/10352-index-outlook.html
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