LunaticTrader

Investing with the Moon

Outlook September 13

Posted by Danny on September 13, 2010

We did get some additonal gains, as forecast last week, and closed out the Green Period with a 89 point gain for the Nasdaq. Not bad.

Going forward we are moving into Red Period now, which means more caution is needed here. I guess we could still see the market head into the overhead resistance levels we mentioned last week, but that’s where we will probably see more selling come in.
The question is how much selling?
If we can hold on to most of the recent gains, then the market will be well set to break higher in October.
So unless we fall below the July lows, I would use this Red Period to get ready for a year end rally.

Why this optimism?
Well, investment funds report month after month how small investors have been selling their stock funds and are moving into bonds and precious metals.
This has driven up the prices of bonds and metals, but why is the stock market flat over the last 10 months if retail investors have dumped $billions worth of stocks?
There can be only one reason: there must be enough silent buyers for all the stock these small investors have been selling.
And these silent buyers must have pretty deep pockets.
So what does that mean?

Good Luck, Danny

2 Responses to “Outlook September 13”

  1. Gary said

    Where can I find the dates for red and green periods? thanks, gary

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