Momentum Trader Report: 10/22/08

22 Oct

Posted by Momentum-Trader as Momentum-Trader Report

You know we’re in a brutal bear market when the Dow closes down –500 points, and its not headline news. Just another day in this market. Volume was relatively low today, until very late in the day when some heavy buying pushed the market a little higher, but there wasn’t enough buying to make up for the huge losses.

The S&P 500 closed down –6% today, and just outside of its symmetrical triangle, a very bearish sign.

This market could very well move lower and take out the recent lows. As mentioned in Sundays post, inverse ETF’s like SDS could be setting up for a move higher, which is one way to profit from more downside in the market.

I also like this chart of QID.

Keep in mind, these have made big moves over the last two days, but as we have seen, the market can continue lower for many days in a row.

Trade Ideas for 10/23/08:

In addition to the inverse ETF’s above, I have two long stock picks. But to be honest, I ‘m not very tempted to trade stocks at this time, especially on the long side. I will trade these stocks if the market bounces, and only for a quick trade (1-2% would do fine). Cash is still king.