Friday, August 1, 2014

Correction?

The market had a big plunge yesterday. Is it the beginning of my expected 10% correction? Traders are now watching for the 200 SMA (Simple Moving Average for the last 200 trade sessions). I may start buying at 8% discount to the current prices. Check out my SA article on "6 Signs of a Correction" or "Everything you want to know about this correction but are afraid to ask".

http://bit.ly/1lq0whW


To me, low volatility (low volume) indicates the market may be changing direction or the market direction has not been determined. To me too, low market price fluctuation is similar.

The other technical indicators I use for detecting corrections are SMA and RSI.


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From my memory, YTD Dow is about 2.5% while S&P 500 is about 6%. The non-correlation will be fixed. In other words, Dow could be a better bargain than S&P 500. Their respective P/E says the same.

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