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November 1 2014 Weekend Market Comment

November 1 2014 - Well last week you got a green arrow and sure enough the market popped up strong on Friday. Investors dumped safe haven investments like bonds and utilities. Small caps have been up strong this week, and I regret placing such a conservative bet last week, going long, but not leveraged on dividend based stocks. Still up a couple of percent in a week is a happy thing. My bet on financial  stock Visa has paid off very well, I hope you followed me in. About all you can say is this snap has been a bit fast and of course if you use indicators like the RSI you are going to be up in the danger zone, my answer to that is to place a few trailing stops at three times average true range. ATR is an indicator you can find on Stockcharts.com and many other charting sites. Of particular interest is a type of graph called a chandelier stop. The name comes from a line that hangs off the price like a sort of trailing stop.

So I am in Madrid this week, and I can tell you that the Europian Financial Crisis is a bit of a myth. All the shops and fine dining establishments are full of locals not tourists. There is not the dispair you see in Athens, even the youth look to be happily employed. No question most of the unemployment is unskilled people from former Eastern Block countries that have joined the European Union. But really I see nothing here that is not in the Mexican gehettos of the USA. In fact Europe looks a lot stronger than the USA did in the rust belt era of mid 80s Allentown. Yes people live at a (so called) lower standard of living than the USA, tiny cars, tiny apartments, more public transit, smaller meals... and no doubt taxes here are oppressive and buying power is less. A Euro spends a lot like a dollar but cost more. Still people appear happy, healthy, employed and productive.  Public infrastructure is very good here, again the result of high taxes.

Again sorry if this all looks odd, I am trying to write this from my iPad. Not exactly the worlds best text editing platform and as for graphics... forget about it!

Ciao


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Lets see what is in the charts this week:

CLICK HERE: To see the 100 and 200 series charts



101 Bull Bear Bull market (dark green over red) and now the short term (light green) is up sharply. Also note the dark green 50 day average is in a firm uptrend. NOTICE THE SLOPE (second window), this could be part of a new long term uptrend.Bull market -- expect bullish outcomes…