Just got off the plane and had the dinner home, however, I will travel again with limited internet until 7th June.
Let me first breifly recap the market of previous 6 tradings days I missed. Apparently that was a major correction after break the resistent around 12950 area. My stop loss call on 12950 may shed your loss a little bit. Given most tech and commodity stocks have been flying for a while, this round of correction was not sudden, plus the continued weakness from finance sector. High oil price is an execuse for correction, as always.
For the next weeks, I believe the market will again turn to finance. Dow components AIG and BAC have been dumped greatly and I guess there would be two possibilities in the near future. One will be a decent sell-off comes and leads DOW to 12000. This is very bad situation as most people, either on main street or wall street, don't want to see this. Another possibility would be the rebounce of financial stocks bring DOW back to 13000 area to test previous high and continue a bullish trend. Of course people would like more to see this but we still need to inspect several days.
Trading strategy would be quite conservative. A combination of tech and commodity with your half position in long is OK for now. Be careful if you have short position on financial stocks. Retailers have touched the bottom as I expected months ago. I assume your hedging position on gold longs are quite profitable now.
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