We've had a nice little rally on the Dow as expected, even though it was a bit of a shaky start last Thursday / Friday. However, this gave really nice levels to get in at and we've enjoyed at least a 1,000 point rally in a week. However, the rally was a lot less energetic than I was expecting, meaning we might be nearing the end of stimulus induced rallies. C'mon the FED.... We need more cash and more newbies to pump markets higher.
Anyway, most stock markets should continue drifting higher for now. I expect that the rest of August should see further gains, but with daily momentum almost peaking now, I can't see markets shooting the lights out. I predict that the reality of Main Street economic woes will start setting in and many will start taking profits. I think it's too early for that as regards this latest move but definitely time to bring up those trailing stops....
Remember that most traders lose money because they cut their profits too early and let their losses run, when of course properly disciplined traders do the exact opposite. If trading was a 50:50 coin toss each time, then mathematically one should make money if you let your profits run at least twice the distance of where you cut your losses. Easier said than done of course.... Which is why robots make the best traders.
I'm amazed at how gold has continued to run. I was expecting the $2,000 level and of course when that was breached we saw a whole bunch of new cash coming in as it made news headlines. Silver has done even better, with a smaller trading and investing community and far more demand for the physical, as wealth storage in coins, bars etc. Personally I think silver is awesome and it should find increasing use in medical and other industrial applications as well. Even the ancient druids knew of colloidal silver's medicinal uses, and they used silver reflected light when operating Stonehenge as an advance invasion warning system.
Anyway, I'm babbling. No new trades to put on right now and we're looking for an opportune time to exit our longs in the Dow. We might use the pullback after that to go long again before momentum turns down on the monthly chart, at which time we will be looking for that exciting short opportunity. Meanwhile, shorting vol is still a decent trade, especially considering the overnight free interest carry earned by most CFD providers.