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Futures and options trading contain substantial risk of loss and may not be suitable for all investors.
There’s no denying; stocks start 2010 with a bang.
NASDAQ Composite actually gapped above the range of 2009’s last session on Thursday. And Thursday was a fairly sizable downside day closing 22 points lower from the previous settlement.
The NASDAQ 100 appears to have clearly broken out of a channel providing a measuring implication to slightly above 2000. Currently the NASDAQ 100 is trading 1885 which is 24.69 points higher on the day. Unless there is a quick reversal of direction this pattern suggests higher prices sooner rather than later. A good tip off to that type of reversal would be either a classic reversal with a new high and lower close or we would accept a move and close back into the channel. These may be worth looking out for.
We have been reminded during the course of the day that last year the first trading session of 2009 saw the Dow gain 3 percent only to end January with an almost 9 percent loss. Along with that we have been made aware of how the first three days of January plots the course for the entire year.
But we need to remind everyone that last year is last year. This is now and we must caution against replica trading. Certainly there can be similarities and there are and can be tendencies and seasonalities but today is today with its own unique set of circumstances. Remain disciplined always. Be careful not to trade blindly on previous occurrences.
Keep your seat belts on because we may be heading into some turbulence.
Good trading to all
Jeff
CB&S
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