Broken Support

The chart is ugly unless you are in "short" position.   All major indexes are below their support.  If you are purely rely on TA system, it is time to short instead of buy.   And if you read financial news from major financial sites, the recession is the most frequently used word during the weekend.  Nothing make people feel good. 

Fundamentally, it does not support a higher price either.  After going down so much from its high, the P/E for SP 500 actually  is getting higher..   This is because, the earning actually come down faster than the price.  Talked about bad news come in pair..

With all these, the market is still not oversold.  The VIX is still below 30.  RSIs are all above 30 for all the major indexes.  

It is hard to be optimistic ..

And that lies our only hope.  The gloom mood from public is so unison, maybe we will get some contrarian buying..   SMH and IWN, for example, where the suffering were the most, actually reversed to higher last Friday, that maybe is tidbit evidence in my opinion.

Also, FED meeting is not far away...

However, I probably will be more conservative the most part of the time in the coming week, unless we are back above the support or we have significant development in economic front.  Also,a new project kick off and spring break probably will prevent me from watching the market as much as I would like

Elvis' song:

Wise man say only the fool rushs in but I cannot help failing in love with you..

Love and Trading probably employ opposite side of the brain, in Love, you may want to be a fool, in trading maybe rush in is not desired.  especially now :)

A couple things in trading in general:

For a trader, It is the process that is most important, if you make some money, you need to know how you made it, and is it repeatable?   if you have a good process, eventually, you will profit.  So, review your process every week.

Over trading is a problem associated with 1). not trust your own process.   2). pay too much attention to daily gain/loss on paper.  and it is very counter-productive.   

Since we are face a jitter market, probably take profit as soon as you can is a good thing.

One profit  trade was observed by Barron:  short at the end of Thursday, since nobody want to keep the stock through weekend, the Friday has been down for most of the time this year, so, go along at the end of the Friday and then take profit Monday since people relieved that there is no bad news in the weekend.    It is said, if you trade this way for the year 2008,  you will be up more than 9%, not bad.

So, hopefully, we will get a bounce Monday again this time.

Good luck