Friday, June 15, 2012

Market maybe ready to break out of its range bound state


Today’s market action indicates that the market maybe ready to break out of its range bound state.
  1.         Market Breadth Ratios have not shown the desired upward thrust.
  2.          Short term price trend (daily prices) has started to move upwards. Medium term price trend (weekly prices) has still not made up its mind though the bias is towards the upside.

In this kind of a market, dividend paying value strategies like “Dogs of the Dow” work well.

Aggressive growth trading techniques can be used with tight money management. Look at the “Sector Leaders” list published by Investor’s Business Daily for growth stock ideas. Tight money management means investing only 20% of your portfolio in those stocks and getting out fast if the market changes its direction. Look at the blog of June 8th for successful trading technique in growth stocks.

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