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The S&P 500 has broke new highs, and is likely to have a pullback before climbing further. This means that stock investors are still bullish on this market for the medium-term, and traders should not short till there are more signs.

^gspc 100314 s&p 500

The STI is also pretty strong, exceeding my expectations of a pullback. As a trader, the correct mindset to adopt is that the market is always right, so even if I was expecting it to drop, I must always be prepared for the exact opposite to occur, and act profitably on it.

As mentioned in some previous posts, the commodity counters are extremely strong, and I will continue holding on till I see signs of weakness. My short counters like YZJ and SembMar are still in the money, and I have shifted my SL to breakeven, so I am not too worried even if the STI continues its strong move up.

BA scan 100314 top performers

Looking at the chart below, if the STI clears the selling zone (circled in red), we have to take one step back and see the bigger picture, which is a large rectangular range. If we were to consider the recent breakout as a bullish flag breakout, we could see the STI surging all the way to the 3240 level.

^sti 100314 straits times index

Instead of trying to predict the market, I am ready to trade on both sides. As my mentor used to tell me, “trade what you see, not what you think.” Good luck!


Hi, Spencer here! 😀

After making my first million at 28, and trading & teaching across 60+ countries, I have consolidated my knowledge and experience to create the most comprehensive & practical guides for profitable trading, compiled from thousands of books, websites, courses, and interviews with professionals.

comment-img As a former professional trader in private equity and proprietary funds, I have over 15 years of market experience, and have been featured on more than 20 occasions in the media.
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