Weekend Review 01/22/2016

While I view the market as binary, I choose not to do so through the prism of bull or bear market, but whether or not a market is conducive to my style over my time frame.  One of the reasons I take this view is that it is on my terms and not contingent upon someone else's perspective, belief, or just plain bloviating.  Recently I've seen a number of views as to whether the market is currently in a bear phase or not.  I've seen: We're in a bear market because the Russell is down over 20%.  We're not in a bear market because the SP is only down 10%.  We're in a bear market because the number of NASDAQ stocks above their 50 period average is below 10%.  We're only in a correction.  We're about to top after a 7 year bull run.  We're not in a 7 year bull run because the Russell dipped 20% in 2011.  Confused yet?

This weekend I'm not looking at breadth metrics in particular.  Weakness beget more weakness the past couple of weeks and expectation of a reflexive rally failed to produce.  So now my expectation of a strong bounce has only increased and I continue to view this as a high probability event.  Whether it is conducive to trading on my time frame or not is a different issue to assess.  What I am looking at this weekend is my scans to see if there are potential candidates.  The reality of the situation is that there really aren't many to look at since my scans are barren to begin with.

One scan that I run it to look at stocks that have made a $15 move over a month period.  There are only three that met the scan conditions.

$15

Another I run is is stocks that have shown consistently steady momentum readings.  There are 9.

Slow and Steady

A scan to check for stocks that move my expected return over time frame shows 99.  If I limit this by the stocks that meet my momentum requirements there are 17.

Return over TIme Frame

As I'm primarily a long oriented swing trader the scans I run daily tell me everything I need to know about my market.  The number of stocks hitting new lows vs. new highs over different time frames tells me what I need to know about the general health of the market.  What anyone else says shouldn't be informing me.

This is often easier said then done.  As a market participant I believe that most of us have the best intentions but fall into the same pits.  Most of us at one point int time have said we would stop doing something or listening to somebody, yet not follow through.  Most of us have said at some point we would improve one thing about our trading, yet not start.  As some point we've likely said we'd simplify our charts only to add one more indicator after rebuilding them from scratch.  There's a good change we've said we'd simplify our watch list and vehicle selection only to open up the restrictions when there weren't enough candidates.

We're currently in a chippy market when everybody has something to say and expect others to appreciate their 2 cents like it's a nickel.  There will be calls of a crash.  There will be post of people claiming to nail the bottom to the penny.  If ever there are times to focus on controlling what can be controlled and hermetically sealing oneself in a vacuum it is now.  If there is a time to listen to the market alone it is today, with the market closed. Put on a headset and listen to some tunes, the only respectable noise to be letting in right now while doing your own analysis.