Hi all 👋 Hope everyone is doing great!
I hope by now it has become clear to all of you that this is by no means the kind of market environment to push the pedal and really go for the jugular. A large percentage of cash and incremental progressive exposure remains the game plan, the market has been giving clear feedback recently with deterioration of market breadth, limited breakout follow through and poor market leadership that currently, our time and efforts should be put towards studying rather than haggling for cents in this hard-penny environment.
I am glad that I stuck to my plan laid out last weekend, one of limited trading and directing my efforts to studying charts and different reading material as we recognized the unfavourable market environment we are currently in. This not only helped me preserve the nice equity spike I experienced last week but also allowed my to have a clearer and more unbiased mind in regards to interpreting the market action we are currently seeing.
Being in cash is a tactical advantage for any trader, it allows you to observe through an unbiased lens and so prevents us from allowing our personal thoughts to dictate trades, as opposed to the ultimate indication - the general market and individual stock behaviour.
In this article I will go over:
Situational awareness - A review of what the general market and indices are showing us
Industry groups - What groups are breaking down vs showing relative strength
A recap of the trades I took this week
The action displayed by leading stocks
Stocks currently on my focus list
Actionable trade ideas
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