CNBC cites four reasons why the stock market has had the best September rally in 70 years (see article).
We have participated in 100% of this rally! Anyone disappointed that the article didn’t mention any of the reasons we cited that it should happen, BEFORE the rally took place? I cited in this article (see post) that the Euro/Yen has been a great indicator for the stock market and it was suggesting a good short-term rally in stocks and that the rally would surprise the majority of investors. Or that numerous “downside bullish wicks had taken place at support!” (see post) Disappointed that they left out the quality technical reasons to buy stocks, yes. Surprised NO!
Now the key becomes, how much of the rally can we keep if the worm turns. Right before the close yesterday (see post) for those willing to score on defense, we suggested to purchase the inverse Russell 2000, due to this poor single day action at the top of the trading range. Below is a more detailed look at the Russell.
Game Plan…Own the Inverse Russell 2000 ETF, with a 2% stop above the top of the trading range! Why the Russell Index? When compared to the S&P 500 and Nasdaq, only one of the three that is at the top of its trading range! This idea is for aggressive investors!