This is a make or break week for the fledging uptrend. China PMI is out and the number most likely will sustain the uptrend until Thursday. The ECB speaks about rates in Europe. This will affect all markets. Remember, what counts in this game is how the market interprets the information… not what you think. Even if the uptrend “survives” what the ECB throws at it Friday looms large.
Friday brings us the non-farm payroll numbers. This is big. Why? Contracting GPD along with a bad employment report could give bears the fuel they need to crush the trend higher.
How should you prepare?
Execute your plan. If you plan is to nibble on a few high quality stocks do so. Have tight stops and use small size to protect yourself for major portfolio damage. You can always scale in after with more size later.
For credit spread traders… there will be so much pent up volatility this week that I think you can wait until Friday morning after the market opens to place your trades. If you do wait until Friday morning let the market open up and shake out the emotion. The true intentions of the market should be know by 10:30 central time. In regards to spreads; this is a marathon not a sprint. If you sit this week out it’s ok… your goal every week to make the most amount of money while assuming the least amount of risk. If you’re not comfortable skip the week. Now, one more word on this topic… I’m betting that you’ll find great premium 2 standard deviations out on Wednesday afternoon. So, if you’re experienced you should be able to find some great opportunities.
Here are two resources to help you successfully navigate the market.
To see my watch-list and game plan for this week watch this video – http://vimeo.com/96957792
To hear my expanded thoughts on the markets, how to be positioned and the psychology of this market listen to the radio show I’m lucky enough to co-host with Danny Stewart – http://www.thewallstreetshuffle.com/category/podcasts/
You can listen to the show live on Saturday’s at 10:00 AM – just click this link and bookmark it – http://www.iheart.com/live/1190AM-4276/?autoplay=true
You can also listen via the iHeart Radio app. Simply download the app to your smartphone and search for 1190 AM Dallas. There is even an alarm you can set to remind you of when our show is on.
If you want to come into my office and learn about credit spreads send me an email. It would be a pleasure to meet, bond and talk stocks together – [email protected]
I often talk stocks and markets on twitter – you can follow me by searching for my handle – @TJReazor
I hope today’s newsletter helped.
The information presented is for educational and entertainment purposes only. Opinions and information expressed are based upon information considered reliable. However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.
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