See charts below with an On Balance Volume indicator and the Money Flow Indicator using a 13 period
Not a lot of change from last week. The rally has slowed a bit while the market (traders and investors) take a breath. Money flow and OBV has pulled back as stops are tightened and some selling has happened, traders becoming more cautious. The indicators last week did suggest there could be a reversal or either some consolidation. It can be a tough time when markets are strong but fear kicks in, many sell too early to lock in profits, to then see the market rally again. That experience then results in frustration and FOMO, traders jump back in and then get caught with buying the top.
The answer? Have a method and stick to it, know your exit and your risk (trade sizing) should have been pre-planned BEFORE you bought. It will be interesting to see what happens this week, if the market kicks up again, consolidates (like this week) or falls. Speaking of dealing with emotion etc, please read the note below and check out the link.
Until next week!
Peter
PLEASE NOTE: I have been invited to be a presenter, with four other traders for a free webinar on the 17th Feb. The conference is sponsored by Go Markets and runs between 11am to 4pm and I will be speaking at 1pm. Registrations can be made on the link below and my talk is "Trading with a Zen Mind" a talk I gave at the ATAA National Conference last year and also in Shanghai (online) last weekend.