Friday

TheInflationist’s Next Move

We upped our profit protect to 8280 from our earlier 8230 (Rule #4: Have a trailing profit protect stop loss, move it up as markets move up) for one of our positions - 20 points below 8300 because the market loves to go below nice round numbers. Since then, market has tanked to 8108 and making a recovery (8230 as we speak). As we said, be unafraid to take profit as markets often become volatile near turning points or support levels. Our other position is left open. Whilst our indicators suggest this is just a pullback in a sideway or upward rebound, we do not expect market to go up until next week. Theinflationist notes that many technical and fundamental stock trading blogs and news are beginning to doubt a recovery and are now predicting a fallout breaking November lows - this is again reassuring, as the majority is often wrong (someone has to pay for our profits!). We are not jumping back into this attempted rally as there is 2 hours left (alot can happen in two hours, especially the last 30 minutes). Our indicators suggest this downtrend is close to over, but not yet. We will (perhaps foolishly) stick to our guns and put another order to open at 8100 (our support is at 8050) and not chase - hoping that the Dow will tank harder into the close as we open more long positions. We put an order to open at 8100, 50 points above our 8050 support for the day. If we are wrong and the market goes up from here without looking back, we will be (half as) happy as we still have one position left open. Our Australia 200 long position is still open (We opened another long Australia 200 in our personal account at 3470 to average down our entry level). Also, Theinflationist believes last night’s 7995 was probably the low for this wave down. Our technical analysis loses its sensitivity for micro trading, but so far have proven correct for medium term trading. Lastly, do not short at these levels - have a net long position but unafraid to take profits when it presents itself. TheInflationist often has two positions, one for short term trading and the other medium term. Big picture, we are aiming for DJIA to surpass 10000. The world (ie media) will be upbeat and the worst would seem to be over prior to the next crash. So we will probably ride our positions up, subject to technical indicators. Stay tuned for more updates.