Don't Fight the Trend, Even if There Isn't One
This sideways trade for the last few weeks is typical of summer markets, even in an “anything but typical” year for investors. Everyone is so conditioned for strong moves in either direction it has left many unable to handle an undefined trend.
The stall has disappointed many market watchers — with some calling for a new downturn. Over my years I have found it better to follow the trend without trying to catch the turn. Don’t be too proud to miss some of it. Most of the money is made in the middle of a trend, and that’s where we’ll stay here at Resource Trader Alert.
Volume seems light and something is needed to spark movement after the large bull run. The S&P 500 channel — with lows last week at the 899 level (as a support level) and highs at 925-plus — is an area to watch closely for future clues. At the same time, Treasury bond futures weekly highs at 117 and lows at 114 have held traders in check. The breakout for either asset class will light the way down the future path for the markets.
For now, let’s wait and see what trend develops. Have some wine, and let the market sort things out.