I believe in Technical Analysis and its my firm opinion that a trader, at least short term trader has to follow technicals. As you know, I have not posted any new analysis since the "Weekly Analysis" on Sunday. There are two reasons for that:
- I am feeling very undecided. After what happened last week one can safely assume that markets are being manipulated. The Men In Power are doing strange things and have resorted to DIRECT intervention in financial markets. Its not that they had not been doing it earlier, they were, but the intensity of their efforts and the desperation has made it crystal clear that they will interfere and brazenly manipulate markets in the coming days. Today they are banning short selling, what happens if tomorrow THEY announce they will sit on terminals and buy like retailers !!! And remember, they don't NEED money, they have their printing presses running in the basement. Recently they were busy "stabilizing" naturally falling dollars and their "efforts" have now turned towards financials.
- The second reason is, as I concluded in my Weekly Analysis, there was a doji on S&P 500 Future with a long shadow and tail. The indecision in traders' minds was clear. So even technicals are saying its not a time to trade. In fact traders are scared to take positions as they don't know what to trust and what not.
- The law of gravity - "what goes up, comes down". Buffet had been going up and went too far away, he had to fall and this is what he has decided to be the cause.
- Scientists say our brain cells degenerate and deteriorate with age and aging buffet might be showing those signs.
Friends, Technical Analysis is a measure of psychology of traders who participate in FREE MARKETS. A chart reflects what mass psychology is about and what are the implications of that. But, when markets are brazenly and blatantly manipulated, the charts may not produce the same results. This is why I am sitting quiet, scared to trade.
I apologize to all those who may have felt bad reading this post and I accept from the core of my heart that "they" are powerful and I am nothing. "They" may soon become almighty.
- The Undecided Trader