$SPX for the week 12 Mar 2018
After a lengthy break enjoying the holidays, the sunshine and finishing off some projects I am continuing with the weekly $SPX blogs and some others too.
There has certainly been some changes in the market from the relative ease of buying dips and breakouts in a low volatility environment. It is certainly one of the “easiest” markets I have seen in my ±20 years of following financial markets. I say “easiest” with some hesitation as there is not much “easy” in trading.
In one of my last blog posts and several before that I had mentioned a channel the S&P was trading in and expected a pullback from the top of that channel at the time. Note: I do not trade those views, I keep following price. The pullback did not happen and the S&P “took off” extending way beyond the channel top and it’s 200 day MA.
I did not act on this potential information (with hindsight it is easy) and preferred to let it play out. Some members in the Dynamic Trader community did act on this information, amongst other indications and tightened up on trailing stops which turned out to be a good call. I was quite happy to leave my trailing stops and banked the profits on the turn even though I gave up on a bit of unrealised P/L. There is no right or wrong way of doing things, there is a consistent way and up to one’s own style of managing trades.
Where to from here? Simply put — rangebound. After exiting all positions (except for one which I initially got into on a mean reversion trade and swapped to my trend portfolio) I am on the sidelines until there is a clearer indication that the trend is back. For now I see this as a sideways market and would prefer to sit on cash than sit through a potential “choppy” time. Again there is no right or wrong, just a personal style that still meets my personal goals and objectives. (Click the link to read my article on this topic)
Forex is gaining a little more attention and a number of pullback opportunities have been taken by members in the community, however there has not been follow through on these opportunities. All we can do is follow a process and at some stage the opportunities will come good.
I have left the S&P chart as I had it from previous to see my analysis at the time. It is a very different looking chart now, patiently waiting for a break of the Jan highs or the 200 day.
Conclusion: Protect capital and allocate risk when there is better opportunity.
Hopefully the above helps you to further your trading. If you have any questions then please feel free to contact me on my FB page or email Miguel@TraderMig.com
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Good trading.
Miguel — TravelingTrendTrader
Email: Miguel@TraderMig.com
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