ARE YOU A KNIFE CATCHER?

If yes trade in this ranging, up & down market and burn your money. If you don’t want to be a knife catcher you should wait and watch until the knife hits the ground and react on that event only. Recently the market is coming off smoothly and doing nothing at all, stocks are down moderately for this week after a great five weeks rally. So, in this ranging and consolidation period we have to be more suspicious.

The point is that, periods like this without a clear trend just green bar, red bar pattern only good to burn your money like the paper tissue in the fire. Don’t try to figure that out what is going to happen, we can’t predict the future. Wait until the knife is stopped and occurs some confirmation about the uptrend again. Let’s be fair being patience is one the hardest effort in trading, I know.

What is the consistent and proper strategy now?

Watching and waiting for this pattern on S&P500 chart: the daily price should close above 1,999, until that day do nothing because the knife is still falling. If you do nothing you will much more profitable than doing something.

The BFM Assets Team.