Sunday, September 13, 2009

5 signs the rally may be over

We've had a very nice move up in the stock market.

More than just nice — one of the best moves ever.

We went up over 3,000 points in 6 months.

You've watched in disbelief as our resilient markets climbed higher month after month as you continued to wonder — how long can this last?

There are some strong signs indicating that this ride may be reversing directions.

Here are five warning signs that the rally could be over:

No. 1: Failure to Make New Highs

Both stocks and the overall market have been unable to break through their latest highs. When the ceiling is firm, you need to check the floors. Traders will want to make sure that stocks have solid support underneath them before attempting to push higher again.

No. 2: Stocks Are Starting To Trade Lower After Good News

From the AP wire: "The drops came despite upbeat economic data, with U.S. manufacturing showing growth for the first time in 18 months and pending home sales rising more than expected to a 2-year high." The strongest sign a trader can see is an up move following negative news. The reverse is what we are starting to see now: a down move following positive news.

No 3: Unemployment Continues To Remain At Uncomfortable Levels

If you think about the fact that you can only receive unemployment for a set amount of time it makes you wonder, what would that number be if the people who were no longer allowed to receive it counted as well?

No. 4: Overseas Markets Are Indicating A Downward Trend

Once thought to be a lagging indicator, it is now uncertain as to who is leading who. We can't confirm that Europe and Asia are in the lead but the possibility is there, so more attention needs to be paid to these markets. (They traded lower last night as well.)

No 5: The Effects of the New Administration Will Start To Run Their Course

The face of our country changed with November's election and Obama's January inauguration. If or when the tax increases that were talked about become a reality then consumer sentiment could fall to new lows.

According to ABC News Senior White House Correspondent Jake Tapper: "President Obama's budget proposes $989 billion in new taxes over the course of the next 10 years, starting fiscal year 2011, most of which are tax increases on individuals."

As you try to anticipate the stock market's next move, continue to look for other "tells."

Example: AIG's short squeeze was quickly subdued with a big selloff instead of being held up on emotion for days or weeks. The duplicity of its move was evident from the beginning but the speed of the correction could be an indicator of a more macro market sentiment.

Example: The financials, as a whole, led us up and if they continue to retrace then that's even more weight on a market that seems as if it is being pulled down. You can even make a separate portfolio of just financial stocks and check that every day to see where the sentiment lies.

Everyone is unsure of what is going to happen next.

"People are a bit cautious. A lot of money has already flowed into the markets," said Lorraine Tan, director of equities research at Standard & Poor's in Singapore. "The question now for most investors is 'Do I put more in at these levels or wait for it to correct more,' because there's uncertainty out there about the strength of the U.S. recovery."

The key is to embrace that uncertainty and fall into your comfort zone.

Trade smaller sizes, take more of an active role in managing your positions, and don't lean too far in one direction.

Being able to recognize what's happening gives you a head start on the masses.

By positioning yourself ahead of the crowd, you will be able to have smoother and more successful trading on both sides of the market.

The goal is not to scare you out of the market.

Nothing is permanent.

Any change in direction will undoubtedly be followed by future changes in direction.

The goal is to make sure you take an active role in managing your stocks vs. a passive one.

You can profit from these market moves.

You should be profiting from being ahead of the herd.

Keep your guard up but be ready to land some punches too.

Learn more at AdamMesh.com

© 2009 Newsmax. All rights reserved.

No comments:

Disclaimer

Disclaimer : All information given here is for information purpose only. Users are advised to rely on their own judgement or investment advisor when making investment decisions. This blog is not liable and take no responsibility for any loss or profit arising out of such decisions being made by anyone acting on such advice.

Disclaimer && Decalration

This blog is formed for sharing useful information from financial world. This blog aims to increase the awareness among the people so that they are well informed .The blog also shares some details for investor, trader ,newbie friends in stock market on free buy/sell/hold recommendations. Here the recommendations are shared along with information on Stock Splits, Right Issues, Bonus Issues, Latest Stock market updates. This publication is not, and should not be construed to be, an offer to sell or a solicitation of an offer to buy any security. This publication, its publisher, and its editor do not purport to provide a complete analysis of any company's financial position. The publisher and editor are not, and do not purport to be, registered investment advisors. Any investment should be made only after consulting a professional investment advisor and only after reviewing the financial statements and other pertinent corporate information about the company. Investing in securities is speculative and carries a high degree of risk. Past performance does not guarantee future results. This publication is based exclusively on information generally available to the public and does not contain any material, non-public information. The information on which it is based is believed to be reliable. Nevertheless, the publisher cannot guarantee the accuracy or completeness of the information. This publication contains forward-looking statements, including statements regarding expected continual growth of the featured company and/or industry. The publisher notes that statements contained herein that look forward in time, which include everything other than historical information, involve risks and uncertainties that may affect the company's actual results of operations. Factors that could cause actual results to differ include the size and growth of the market for the company's products and services, the company's ability to fund its capital requirements in the near term and long term, pricing pressures, etc.

References


References :- Link Market - Free Link Exchange, Link Swap and Link Trade Directory
Have you ever tried to exchange links, swap links, or trade links? Was it hard? Use link market instead; - it is easy to use, free and very smart. It will save you hours of work.

Business PandaOnline business index
Xmatrix SoftwareXmatrix software publishes award-winning software, including x dupfile. And we have a xmatrix online business index that is growing.
Eladvertise.net
Buy text link advertisement for unlimited impressions. Act fast. Price starts at 15 euro and goes up.
King Cole Catering
Event and banquet caterer - banquet room rentals - weddings, receptions
Pulbic Adjuster Galveston
Www. Docudamage. Com is an information resource created by a public adjuster for policyholders, adjusters and contractors wishing to learn more about property damage documentation & the claims process.
Public Adjuster Galveston
We are a texas public insurance adjusting firm located in houston, tx. We represent home & business owners to their insurance companies on underpaid property damage claims. We are happy to give you a free evaluation of your claim. Call today!
Foreclosure - Financial - Credit Repair: Tips & Articles
Homeowner, credit repair, foreclosure, mortgage, investment, and stock, tips, articles and help. Financial help articles for consumers.
Used Cars Uk
Autoleague. Co. Uk is the right place for you to find used cars or dealers that sell used cars anywhere in the uk. Advertise your car for free. Make An Extra $2000 - $5000 Every Month With Vemmabuilder!
We will show you how to live a healthier lifestyle and earn a large income for little cost with our vemma products and vemmabuilder marketing system! Apple Computers, Parts, Software And Hd Background Free
Save on computer parts, computer hardware, laptop computers, desktop computers at ewoau. Com. Now free downloads and tons hd background free.
1v Web Design
Website design and development | free seo information and code tips | advertise on our world wide directory | find link partner's to help increase your page rankings | free stuff and much much more. ..
Shop All Broadband & Telephone | Phone Service Providers Here!
Shop communication service providers, price quotes and solutions for cable internet, high-speed satellite, fixed wireless, dsl, t1, t-1, voice t1, integrated t1, pri t1, bonded t1, ds3, ds-3, oc3, oc12, ethernet, vpn, mpls, sip trunking & voip here. Yard Signs
Speedysignsusa is one of the largest suppliers of yard signs, election signs, and political signs. Our store features a large selection of professionally designed templates, an online design tool, and the ability to upload your ready to print artwork Free Music Download
Download free music movies games at http://www. Topfreemusicdownloadsite.com Fixed Gas Detectors
Auric pacific engineering is the leading distributor of fixed gas detectors, portable gas detectors, solenoid valves and gas analyzers.Sediment Erosion Control
Deltalok is a leading company specializing in sediment erosion control, soil erosion control solutions.Harley Davidson Zone
Harley davidson zone! Customize yourself and your harley davidson motorcycle like you've always wanted. Whatever you ride we have what you are looking for. From jackets, boots and helmets to chrome accessories we are your harley davidson zoneLuontaistuotteet Proteiini Hiilihydraatit Immolina Sikainfluenssa
Www. Nutrition. Fi kun ei ehdi kaikista lisäravinteet ja luontaistuote jutuista huolehtimaan. Vitamiini - ja ravintolisä -tuotteet arkeen ja urheiluun. Sikainfluenssa - eli h1n1 virusta vastaan kehitetty immolina Gastrodirect
Grossiste horeca avec plus de 30. 000 articles pour livraison immediate. Garantie, sav, livraison rapide. Ce que il vous faut, four à pizza, refrigeration, materiel de collectivities.Pink Stretch Limousine
Get your pink stretch hummer party limo. Special events, sweet 16, bachelorette party, prom, wedding, bring baby home, kid's birthday, homecoming, graduation, concerts,batmitzvah, corporate events, quinceanera, anniversary. Affordable hire options.