Okay, so we are now back to the “doom and gloom” days.
The Euro Zone, China, and the euro are all collapsing, which will cause the global economic recovery to falter, which will cause a 10-30% correction in the market. Specifically, sovereign debt in European countries, China’s slowing economy (from 12% to 8%), and the dollar’s rise against the euro are the culprits for the latest impending doom.
Folks, we have problems, and the world has problems, but what else is new? As traders, we need to keep our eyes on the ball, and that “ball” is finding trades that will makes us profit. This also means avoiding the doom and gloom pundits/analysts, who might, or might not get the coin flip right. We need to analyze and conclude based on what we know, which means looking at markets with a clear view of the world. This means we cannot simply avoid the good to focus on the bad. We need to mix it all together and come to a reasonable position. The two excerpts below are from blogs on this site. Both analyze in this frame, a reasonable position. Check them out to see what I mean …
ZacksResearch’s Commentaries, May 5, 2010
ADP Sees 32,000 New Jobs – Analyst Blog
Automatic Data Processing (ADP) reported that 32,000 new private sector jobs were created in April. That was slightly ahead of expectations for a 30,000 increase. As the nation’s largest payroll processor, ADP is in a unique position to assess the health of the job market, although their numbers…
BrewerFutures’s Commentaries, May 5, 2010
Stocks Nearly Unchanged after Volatile Overnight Action
U.S. stock markets are called slightly lower this morning after a choppy overnight trade. Today could be another day of risk reduction as traders are still being influenced by a multitude of factors including Euro Zone sovereign debt issues, new financial market restrictions, the threat of international terrorism and possible criminal action against Goldman Sachs. The range may be limited, however, as traders may begin to cut back on trading ahead of this Friday’s U.S. Non-Farm Payrolls Report.
Making money trading is about understanding markets in the context of the global economic, geo-political picture. Simply looking at the “latest” upheaval and drawing broad-based conclusions eliminates trading opportunities, so pass on the pundits and open your own eyes …
Trade in the day; invest in your life …
