598,000 versus $780 Billion

Well we know which number the street liked better don't we. Although 598,000 jobs were lost in January, bringing the total jobs lost in the last year to over 3 million, it was the $780 Billion stimulus deal the street focused on, enjoying a nice rally Friday. The Nasdaq rose 2.9%.

I have attached the above chart though to put it into perspective. This market is still very much range bound. Although we have been playing around a bit for the last few months I just want to remind you that this has been with only a small portion of the portfolio. The rest is in cash waiting for a trending market again. Patience is key at these times. Do not be one of those traders that give back their profits trying to tell the market what to do. Listen and it will tell you.

As you know I still beleive we are in a bear market in a 4th wave and expect new lows in the future. That is my belief only and I will quickly change this belief once the market tells me otherwise. In the meantime the only way to trade this market has been on an hourly basis.

For those of us long gold I have taken profits last week and will explain why.

This has been a text book trade. Back In mid November we had a double bottom with MACD divergence. The KRD on Nov 13th gave us our buy signal to enter on the 14th. We have now completed the 5 waves and the MACD is once again showing divergence signalling the end of this trend. Now of course you have a number of options here. Take profits and look to re-enter, take partial profits and give the balance some room or continue to hold. Although gold seems to be the place to be I am going to cash and monitor.

One of the reasons is that this is the set up we look for to short. Case in point was this weeks pick from Dan EPIQ. This was again a classic set up for us. Major divergence late last week with a KRD in place. It broke hard as we both attempted to get into some puts.

As far as commodities these are still scapping the bottom of the barrel (pun intended). Still lookinf to get long at some point. (Copper is the new gold)