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CKachi have been involved in the markets for over a decade. He takes an active role in researching, analyzing and always trying to be unbiased in his trades in equities, options and ETFs. He is a strong advocate of extensive research, and analysis to come up with only a handful of trading ideas... More
  • What Market is it? Bull? Bear? When to really know before it's too late. 0 comments
    May 14, 2010 4:32 AM | about stocks: SPY, GLD, USO, FAS, FAZ, UUP
    I've been thinking quite a lot lately about how it's really amusing that by the time the media, individual investors and simply everyone realize that we are in a bull market we are already towards the end of it. And the opposite is true of bear markets typically. A more clearer explanation is how it is believed in smart money that Cramer pumps stocks so those that are holding (think of those as what you wish) can dump and fools can pump or uphold volume.

    So, what I'm out to shed some light to is when to catch those big movements and the bulk of those trends and not enter too late or too soon. Basically, we are talking about market timing. Riding the bull or bear waves and locking in those profits.

    Here are a guidelines and words of caution.

    1. Don't ever try to predict, catch or call a market top or bottom. It will only ruin you. Reason being is the market is more powerful than anyone and it will turn against you.

    2. Turn your TV off and limit your exposure to a daily dose of CNBC, Wall St Journal or any of those mainstream commercial publications that can stir you the wrong way.

    3. When testing your positions in the market, and trying to get a feel for the trend, always use stop-losses and get out when your unsure of what direction things are going.

    4. For Bear Markets we will see a lot of rallies on low volume and high opens with lower low closes.

    5. For Bull Markets we will see a lot of rallies supported by high volume. Profit taking and lower opens and higher high up closes.

    Remember most importantly the TREND is your FRIEND.

    Yes, yes we all know it's very cliche but, I urge you not to go against the herd. 

    Disclosure: Long GLD
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