a wait and see market

Friday’s close was a classic example of what I have been seeing and preaching for about a week now.  This is a ‘wait and see’ market.  The bulls are not willing to assert themselves, and the bears although more aggressive than the bulls, are also not sticking their necks out very far as well.

Certainly we have a bearish hue … but right now it is better to just be out of the market and wait to see which side asserts itself.  It is just too risky to be on either side (unless you are a very short term trader).  For the intermediate to longer term traders … we need to let one of the sides gain an advantage before the reward / risk ratio makes sense.

With that said, if my life depended on placing a wager right now as to which way the market will be going … it certainly looks to be that we have more downside and although I was hoping for a bounce … it seems like the market isn’t interested in that right now.  But, again … the signs are just not obvious enough to take any risk right now.

As most of you know, I have been slowly moving to a cash position over the past month, and although I am still slightly invested (on the long side), I have adjusted my stops to be tight and fully expect those positions to be stopped in the coming week.  I have no issue with sitting in cash while the market gains clarity. 

Let the bulls and bears duke it out without having to feel the pain they are feeling…