subject: Stock Trading Secrets Pt1 [print this page] Daily Stock Report for Monday Morning, February 8, 2010 pt1
The stock market followed through on the downside Friday morning all the way until 2pm ET and the rebound we were looking for started and turned Fridays market from a 1.7% at the worst point of a 0.74% profit on the Nasdaq Composite.
The market dropped more than we anticipated on Friday with the Dow being down as much as 2% at about 2pm ET followed by a strong rally to close on the positive side for all three major indices.
The rebound we expected to occur on Friday did start later and after a deeper correction. On the short-term trading action, it looks like we could have a couple more up days followed by some selling and this volatility is going to cause difficulties for anyone who is not a nimble trader.
On a little longer term horizon, we could easily see more selling ahead and my best guess is it looks like we are starting a downtrend that is more than just a pullback within an uptrend. It may be just a smart strategy to have smaller than normal positions and less money in the market.
This is the time where the intraday scalpers will make the most money on a consistent basis with stocks making good moves up and down. On the steady uptrend runs (a new term?) as we saw for two months from early November to mid January 2010, scalping was still profitable but much less fruitful. The current environment for scalping is much like fishing in a fish hatchery and the run is in.
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