Thursday, August 30, 2012

Down She Goes, Right?

I spent the weekend gathering data to give me a better view of the market. Think of standing on a big hill looking over things instead of standing in the middle of the city street watching cars and people go all around you. When you're right in the middle of the action it can be hard to see what's really happening, you get caught up in the commotion. Taking a few steps back allows you to remove yourself from the day-to-day hussle and bussle.

When I completed this task I noticed the market has actually been growing nicely for the past 3 months or so. I also noticed it has started to weaken over the past week. Looking at past data shows after an 8 - 12 week upswing we're probably in for a multi week correction.

I sold 25% of my 401k account. I would have sold 75% - 100% but I can only trade a fund once every 30 days and I bought it about two weeks ago. That means I have to wait two more weeks before I can get out of that position.

I'm also short the market right now. I'm sitting in DUST and RUSS. RUSS is definitely weak and should continue down with the market. DUST on the other hand is a bit riskier. It has been known to go against the market but after looking over it I feel confident that is has room to move down.

No comments: