Weekend Review, Dec 5/09

"In trading, however, the person who can easily admit to being wrong is the one who walks away a winner. Besides trading, there is probably no other profession where you have to admit you’re wrong. In trading, you can’t hide your failures. The trader who tries to blame his losses on external events will never learn from his mistakes." - VICTOR SPERANDEO

Read Full Post.....

This is a SPY chart from Monday highlighting the sideways range for the past 3 weeks:


Here's what has happened since Monday Dec 1/09:


The chart can be interpreted two ways:
a) There is a complete lack of consensus amongst market participants as to market direction. Result would be more sideways consolidation
b) There are quite a lot of buyers at support still, and this is the process to make them give up control.


Sentiment has been neutral for the past couple of weeks:

Through most of the past 3 weeks of sideways consolidation, I have observed that when sellers take control, they could not follow through, but when buyers take control, they follow through. Friday's NFP selloff could be construed as follow thru from the Dubai selloff; however price is at much higher levels ever since the Dubai selloff, so the sellers have much more work to do if they want to take control.
That said, I think the odds are good for this coming week that the bottom of the range will be tested.



I will be looking for Resistance 1112