Where is the market headed ? Sell and go away?
There are time when It does not makes sense to trade at all. There are people who are very good at shorting stocks and taking them to cleaners. The market always presents these cycles every now and than. The stock market never stays the same that’s for sure. Since Bin Laden’s death announcement May 2, 2011 the market is cursed and has done nothing to make money for bulls. All major stocks have been sold off while the indexes stayed where they are. When leaders are sold off than it somewhat worrisome to the bulls. Most of these stocks are hitting their 50 day moving average or they are below them in the bear territory.
There is some soft data on the economy. The euphoria is fading and some down turns are showing up in the stock market.Data showing economic weakness added to the fears. On Monday, a gauge of manufacturing in New York State slid much more than expected in May to its lowest level in five months, the New York Federal Reserve said.
The indexes are not down so much as the leaders. NFLX, CMG, PCLN and AMZN down from 10, 5, 17 and 7 point respectively. Lots of selling in the leaders. I am glad we are out of NFLX and CMG in time before they went down.PCLN and LULU both strong stocks are sold off by short sellers today and positions have losses. These are June contracts so we have time. Here is a chart of SPY which is some distance from its 50 day moving average. But leading stocks are are a different story.
The market is very tipsy and any bad news will sell it off in big numbers.We are just going to stay on sidelines and see how it goes. If you venture out and buy something, it will result in in immediate loss right now. This is the time when you just know not to trade. Its hard to do this