About Time!

It has been about a week and a half since my last posting. There has been no real reason for this other than being short of a little time (while I finish up remodeling my house and preparing for the birth of my first child at the end of the month!) and waiting for the damn obsessive FED announcement on Tuesday. I have managed to get on line and look at each day’s action, but finding the time to make a post have been difficult. I need to work on that.

On the last post, I said that I have been waiting for the market to tell me which way it is going to go. Revisiting the DOW chart that was also posted, we can see that it has completed its move to the drawn resistance line. On Thursday, the index broke through resistance to close just above. On Friday, It surged +100 points to a new high, it then dropped around -150 points to make the session low and then rose approx +50 points to closed just above resistance. What a couple of days!

$INDU 60d/60m chart

Looking at the chart, Volume appears to have been gradually rising over the last ½ a month. My Sto and MACD look to be getting ready to tip, RSI appears to be increasing and OBV downwards. The unknown – What the FED is going to say and how the market will react.

In my mind, The DOW has completed this leg up, but the index still does not give me any clear indication as to what to do. I wan to buy some select puts, but I remain cautious until tomorrow. My expectation is that it will make another leg down after the FED announcement. Based on what I have been reading in the news media and on other blogs, the economic outlook is bleak and there is little reason for the market to rally.
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As for current trades, I still have the QCOM strangle. I added some DIA Puts last week. I am looking at entering a number of new trades after Tuesday.

Good Luck - David