Weekly Market Review: April 24, 2009

This week's market action is practically a carbon copy of the week before. We started on Monday with a huge gap down, regained some footing on Tuesday and Wednesday, dipped lower on Thursday, then climbed back to the level of the Friday before. Obviously, we're in a trading range these past two weeks around 830 - 870 on the S&P 500.

From Figure 1, we're still in the over bought level, with signs of divergence, etc. etc. You've heard this tune before, so I won't repeat myself. The only thing for certain in this volatile market is that ... it's volatile. So no matter which side of the trade you're on, I'd be more picky in this market.

Obviously, the support is at 830 and resistance is at 870 as I've said. Also, notice from Figure 1 that volume has been relatively low in this range so far. If there is any breakout either way, volume and momentum would be the things to watch.

As of right now, my portfolio consists of SRS, USO, and ESLR (from way back). Needless to say, my SRS is at the bottom of the sea with a 50% loss for the trade. This is just unacceptable. I have since written my trading rules in stone and vowed to never break a stop.

On the plus side, this has certainly woken me up again as I've been getting complacent lately in my trading regimen. Thus I'm relieving myself to just light trading and heading back to trading development and would spend most of my time improving my systems and skills.

[caption id="attachment_1304" align="aligncenter" width="500" caption="S&P 500"]S&P 500[/caption]

[caption id="attachment_1305" align="aligncenter" width="500" caption="S&P 500"]S&P 500[/caption]

GICS Sectors Review

This week there isn't any particular sector that was way ahead of the pack. The ones that lag have been the usual defensive plays, Healthcare, Consumer Staples, etc.

[caption id="attachment_1306" align="aligncenter" width="500" caption="6 months: XLE XLB XLI XLY XLP XLV XLF XLK IYZ XLU"]6 months:
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[caption id="attachment_1307" align="aligncenter" width="500" caption="1 month: XLE XLB XLI XLY XLP XLV XLF XLK IYZ XLU"]1 month:
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[caption id="attachment_1308" align="aligncenter" width="499" caption="5 days: XLE XLB XLI XLY XLP XLV XLF XLK IYZ XLU"]5 days: XLE
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