LunaticTrader

Investing with the Moon

Outlook May 16

Posted by Danny on May 16, 2011

We got a flat week with the market clearly hesitating and looking for direction.
Where do we go from here?

The situation on the charts remains quite clear (click for larger image):

Nasdaq

The uptrend channel still remains intact, but the Nasdaq will have to break above 2900 by mid-June to keep this trend going. Failure to do so would probably result in a sharp drop with 2600 and 2500 as initial targets.

We remain in lunar Red Period, so I am looking for more weakness this week. Will we break down already, or do we set up for a nice move higher in our upcoming lunar Green Period?
We will let the market answer that question for us.
This is what reading the market is all about.
We know what can be expected based on our lunar cycles study, and then when we see the price action unfold it gives us new clues about strength or weakness underlying the market.
One eye on the cycles, one eye on the market.

I am keeping some puts to protect my portfolio, and then based on the market action this week we will adjust our strategy for the next Green Period.

Stay tuned, Danny

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