Stocks for the Rest of Us
Posts tagged oversold
Time To Trim The Hedges
Jan 15th
If you took my advice in the last post and put on some hedges I think it might be time to take those off. We’re currently a little oversold so even the slightest spark can cause a fire. Clearly the market is starting to get excited about the news of a Bank of America bailout. Although I can’t imagine how the failure of yet another major bank can be seen as a good thing there’s no reason to fight the tape. Having said that I’m not so sure I want to be getting long here either.
S&P 500 Oscillator Update
Oct 8th
The market is so ridiculously oversold that it doesn’t even really matter anymore. I don’t think the chart has ever looked like this. If you’ve got a longer term time line (5+ years) now is the time to start inching into the market. I’ve personally been buying stocks for my IRA as the market has come down significantly in the past few days. If you’re trading in a taxable account then make sure you’re only using money that you won’t need for at LEAST 5 years. My gut feeling is that we’re setting up for a fairly decent thousand point rally on the DOW but it’s going to be fast and furious so unless you’re a day trader I would continue to sit on the sidelines until the charts start building a better base.
S P 500 oscillator
Free S&P 500 Oscillator Update
Aug 28th
As you know I like to follow the free stockcharts.com S&P 500 Oscillator to gauge overbought or oversold conditions. As you can see we’re still stuck in this consolidation pattern after the huge run we had in July. Although the action may not feel good this is actually fairly healthy. We had a huge move off the lows and a little consolidation of those gains is good. The key is that the selling be contained which so far has been the case. The markets are showing strength today and I still think we’ve got some upside left to the low 1300s or so before I’d start taking profits.
S&P 500 Oscillator
Wall Street on Vacation Makes For Choppy Trading
Aug 25th
The trading action today was again choppy as most of the big wall street traders are most likely on vacation. Volume was low and the moves were jittery. While the major indices are not overbought they are definitely far from being oversold. Therefore you need to take a defensive posture. I’m still net long but I sold off some energy related stocks such as PBR and SJT last Thursday on the big spike. I continue to hold my XLE long position with a stop around 72.50. Seeing as how we’re not yet oversold I would not initiate any new positions here as the risk at this point is too high.
S&P 500 Oscillator still bullish
Aug 19th
The action feels horrible but the S&P 500 oscillator I follow is still bullish. As you can see on the weekly we’ve had a huge move off the lows and I think we may just be consolidating a little bit before another small leg up to around 80 or so before we really have to worry about being overbought. MACD is still bullish and the recent sell off has alleviated the short term overbought condition. I would continue to remain long with fairly tight stops. we’ve got some light trading going on out there so the action is going to be very volatile.
S&P 500 oscillator
S&P 500 oscillator update
Aug 13th
The S&P 500 oscillator that I use is showing some slight signs of an overbought condition but it’s nothing that a few days of chopping around wouldn’t solve. Other then that it still looks pretty good and we’re only at about 60 on the oscillator.
S&P 500 oscillator