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Recent volatility has spooked a number of traders and investors alike. With oil finding its way above US$100 per barrel and looking to stay that way, most traders are asking the question, can the current recovery be maintained at these levels? Others have been actively trading and are probably considering whether now is the time to take profits off the table.
The last quarter of 2010 and into 2011 presented some wonderful opportunities for Elliott Wave traders. Those who attended our Elliott Wave Webinar experienced firsthand the number of trading opportunities during this time.
Today we face a significantly different situation. In last week’s Elliott Wave Webinar, we were a little dovish on the current situation. So it turns out, for very good reason. Elliott Wave buys were scarce, and those which presented themselves didn’t show the technical strength of what we have seen in the past. The old cliché, the trend is your friend rings true. The last few weeks of February made it very clear that the medium term trend was getting ready to take a breather. And why wouldn’t it? Markets have been good to us. We’ve been able to lock in significant gains across stocks, sectors and indices.
There is nothing wrong with heading to the sidelines. Markets need to correct. We need to find the point where net buyers see value and technical analysis confirms the next move higher. This may be closer than we realise. A correction is underway, but after every correction comes a point of perceived value and subsequent opportunity.
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I wouldn’t be buying to trade at these levels and I’m sure a number of other analysts wouldn’t be either. Times like these present an ideal opportunity to brush up on analysis and education. This way we can be prepared for the next opportunities to come our way.
Being patient can be difficult, but it also pays the greatest rewards. If you haven’t yet enrolled in our FREE Elliott Wave Webinar, now is the ideal time to bolster your trading tool belt. Due to popular demand, we have opened an extra Elliott Wave Webinar so be sure to reserve your place today!
Stay ahead of the game,
Lachlan McPherson
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