Patient, Picky During Short Market Week

2021-03-29

Trudging through the sludge of this market, traders are searching for solid signals in a shortened week.

The Dow bounced again to start the week while the Nasdaq and S&P 500 struggled. Traders are wondering when the Nasdaq will catch support for a solid bottom.

Simpler’s traders have been working through this murky market and not all trades have produced gains. Momentum stocks have lost favor and not performed to expectations. The good news is our team openly shares details of challenges (as much as successes) and how to improve moving forward.

Much of what is happening in this market defies trading “norms” and the continued volatility presents challenges. Fortunately, the market fires up each day and the next trade is just a click away… hopefully with improved knowledge of how this market is working.

With the holiday on Friday, this short week also falls at the end of the quarter. Bigger market players appear to be “rebalancing” their ledgers. There are big firms facing precarious positions that require liquidating heavy balances — including a hedge fund forced to liquidate billions in holdings.

These moves started last week and are a signal for lighter traders to be wary of continued market madness.

Simpler’s traders are weaving their way through the chop and slop with patience and staying picky about any trades they put into play.

We’ll continue trading what the market gives.

We Saw: Dow record on mixed Monday of short week — 

  • Pace of tech growth quickens in transports
  • Reopened Suez Canal may still slow trade
  • Another big hedge fund getting tanked

We’re Watching: For a Nasdaq bottom and momentum —

  • Transports, particularly airlines on the move
  • Did seasonal April uptick get stunted?
  • Setups with strong patterns on daily charts