QuadMarket Holiday Trend Update Nov 28

We’ve seen all markets trend strongly after the US Election and Thanksgiving holiday November events.

Let’s first take a look at these stellar, persistent intraday trends and then balance the odds of future short-term reversals:

Here we see the “Quad-Market” or Intermarket Grid I use in my more detailed/lengthy Intermarket Reports.

The main idea here is to track MONEY FLOW across/between the markets for signs of Risk-ON/Risk-OFF behavior.

Clearly, we’re seeing strong RISK-ON aggressive (bullish “all is okay”) money flow.

Stocks are surging along with the US Dollar Index (the Fed will raise rates in December) while the Risk-Off or safety haven of US Treasuries collapses.

Gold also – sometimes a safe-haven, sometimes a bullish play – collapsed $100 from its per-election peak.

With these reactions (money flow trends) firmly in place, we’re now balancing these persistent trends – which cannot last forever – against the odds of at least short-term reversals on momentum divergences.

If you’re trading these markets from a short-term or even swing-trading perspective, create your trading narrative (and thus actual trades) around the “Will the Trend Continue or Retrace?” point of view.

Logic and momentum suggest a pullback is more likely than ongoing continuity but be equally prepared for both.

Follow along with members of the Afraid to Trade Premium Membership for real-time updates and additional trade planning.

Corey Rosenbloom, CMT

Afraid to Trade.com

Follow Corey on Twitter: http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).”