Market Gauge
I am developing this market gauge to help spot the market’s change in sentiment and be able to move to cash or protect my investments. As of now, the gauge is in beta and I am still fine-tuning it.
As of now, I will be using it to determine how to deploy my funds. If the market is in overbought level I will be saving cash, no investments, no buying of stocks or scaling up my options trades.
If the market ends up in the “fair” level, I will use 50% of available cash, trade proceeds and dividends to buy new stocks and slightly increase options trading.
When the market get’s to oversold level, I will be using 100% of cash and proceeds to buy new stocks and up the options trading.
The goal is to allocate cash when everyone is greedy and FOMO, and buy everything these morons sell when they get spooked over nothing or a similar non-issue.
Economic Calendar
It pays to watch the economic calendar if you are a trader (not a day trader, but a position or swing trader). A few times I ignored the calendar and opened a trade right before Jerome Powell spoke and shook the market. In today’s fearful, volatile market, you want to be on the right side of the market or wait for a storm of fear to pass before opening a trade.
Leave a Reply