Monday, 9 December 2013

It is a CONFUSING MARKET NOW!

Dear Friends,

That is my sentiment of Wallstreet now. Is good news a good news, or good news is bad? On Friday, US reflects good employment reports. Both the non farm payroll and the unemployment are indeed above expectations. We predicted correctly that this result to be good. But we predicted wrongly that the market may fall due to the good reports.

IT DIDN'T!

It did not follow the 5 days drop where almost everyday there are good reports that came out. ISM manufacturing did fantastic. So does ADP employment, NEW HOME SALES and Jobless Claims.

And that is the reason for the 5 consecutive days drop, right?! Or did I interpret wrongly about the market??

Isn't the concern about the tapering happening soon if reports are good.

BUT WHY does the market increase a near 200 points on Friday???

Ha, maybe I should just give up guessing and knowing what the market thinks now, and maybe you should too!

Let the market decide its own fate.

I am probably sticking to these 3 rules to know if the DOW really goes into a mid term correction.

1) DOW drop by 100 points in 1 single day (Triple digit drop signals confidence wavering)

2) DOW drop in 3 consecutive days. (Indicating short term weakness) This year there is only 3 times where DOW drop for 3 consecutive days. Each time DOW did that, it is the start of a 1000 points drop. 

3) DOW drop by 2 consecutive weeks (Indicating mid term weakness).

Now probably only the second factor is triggered. Let me see if next week will trigger the others.

I am just going to give up predicting the trend now, and let the market tells me!!!

Confused ;}
Daniel

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