Yet one view of the market's internal state is indicating something potentially more problematic likely is in store here...
The 10-day moving average of the NYSE advance-decline differential is breaking down and, more critically, minimally suggesting the market's advance since mid-November 2012 in all probability is nearing its end, or possibly even at risk of reversing. For now, let's continue siding with the former of these two possibilities on account of the view presented here Friday per the S&P 500 Bullish Percent Index.
* * * * *© The Risk Averse Alert — Advocating a patient, disciplined approach to stock market investing. Overriding objective is limiting financial risk. Minimizing investment capital loss is a priority.
Analysis centers on the stock market's path of least resistance. Long-term, this drives a simple strategy for safely investing a 401(k) for maximum profit. Intermediate-term, investing with stock index tracking-ETFs (both their long and short varieties) is advanced. Short-term, stock index options occasionally offer extraordinary profit opportunities when the stock market is moving along its projected path.
Nothing is set in stone. Nor is the stock market's path of least resistance always known. More often than not, there are no stock index option positions recommended.
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