Mower, I agree, the XJO is in a short term uptrend at least at the moment with the MACD cross almost there. In addition, the preceding XJO MACD crosses in mid October, mid December, and early February have been very reliable. Unfortunately the SP500 chart is not as cooperative for a short term uptrend, but it could be worse, and Friday’s action on the SP500 was somewhat encouraging.
The article shown here suggests that a decent Nonfarm Payrolls (NFP) on Friday 4-Apr could boost the market. Hence, I am tipping that the market will run up to the NFP, then if the NFP exceeds the expectation of 200,000 it will be onwards and upwards. I say this with acknowledgement of the fact that this year the SP500 is essentially flat from 1-Jan to 30-Mar, but in the previous 2 years the SP500 has been up 10% or 12% in the same time period, but this is something that I read without checking the actual numbers myself.
If the NFP is significantly below the expectation of 200,000, then it will probably be a red night in the US on Friday. In this scenario, I will probably close any long trades that I have open at the time on the following Monday.
Bearing in mind the above points, my preliminary plan is to open new long trades on those stocks with the best chart set ups on Monday and Tuesday, then hold through to at least Monday 7-Apr-2014.
Mower, I noted that you typically refer to the DOW rather than the S&P500. However, I don’t take much notice of the DOW and instead watch the SP500. The DOW, as you will be aware is based on only 30 stocks, but the SP500, which is obviously based on 500 stocks, attracts the highest volume index trading on the planet. Back in the old days, when I was trading indices, I traded the SPI and the SP500.
Of course a decent correction will come soon enough this year, but I have all but given up trying to predict when it will start. This dude is predicting a 25% correction here, but although this size correction would be nice, it’s a bit on the fat side imo.
