Allow Me To Introduce…Mr. Investor Fear

March 31st, 2009

Well, that mid-day rally was short lived. If you were looking at any intra-day chart – like the one I have posted below of the S&P – you would have noticed the huge area of overhead resistance at the gap from Monday morning – in green. Clearly, we rallied up to that area during the day and then a funny thing happened before the close. INVESTORS GOT SCARED. They sold off everything right before the close. Notice how steep the decline was right before the close.

 

Evidently traders are not willing to take the risk of holding stocks over-night for FEAR that something might go bad tomorrow morning. Of course this has played in our favor with member’s shorts. Granted, the markets closed the day up about 1%, but like I said this morning, it’s very normal to see some sort of retracement. Again, technical analysis and day trading is not rocket science. Once you learn and master some basic patterns, you will profit from these situations time and time again. My target for the S&P is still around 750 before we get another bullish bounce. I’ll be back later this evening for a New Trading Video.

 

fear

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