As the new year begins to take shape and certain market dynamics are beginning to play out has your trading style adjusted? Despite a seemingly volatile 2015, most equity indices are flat for the year. Your trading performance should be indicative of how you have weathered the storm that has taken broad equity markets everywhere, but ultimately nowhere.
Charts Courtesy of Yahoo Finance
The first month of a new year can be a chaotic one for traders and investors. The forces of habit and the desire to improve and be successful early in the year are at a tug of war. Often it is a great opportunity to check your track record for the year so far. Have you been chasing short term trends, finding yourself on the wrong side of the trade too often? Perhaps you have been reluctant and have been conservative in putting your capital to work.
Given the relatively short time that has passed since the beginning of 2015, it is less overwhelming to replay market scenarios and analyze your trading performance so far. The upcoming months are shaping up to be busy ones. It is best to be prepared.
The year so far has seen the US Dollar continue a relentless climb, the Swiss Franc’s recent spike with the removal of its cap versus the Euro, Greek elections in which an anti-austerity party victory which has stoked embers of days of Euro volatility; the continued slide of crude oil prices, and last but certainly not least, divergent central bank policy changes. The US and some smaller economies seem to be moving along and are beginning to show signs of interest rate increases, while other central banks such as the EU are increasing their economic stimulus programs to try and stave off prolonged recessions.
So far for the year, there has been an interesting mixed bag of performance looking at some major markets. The return of precious metals and continued momentum of long term US treasuries are signs that bullish sentiments, when properly placed, are still paying off. While oil, and financial companies are struggling to get to the green for the nascent year.
This week their is no shortage of economic data coupled with some important earnings reports. A potential blizzard set to hit New York City may keep trading muted in the middle of the week, with some of the larger players in the market working remotely. A weather induced lull coupled with the wealth of new information may mean a whole lot of trading activity will need to get done in short periods of time. Stay on your toes. The past week turned in a strong bullish performance with almost every sector in the green. Will the trend continue and take the market to all time highs?
This week has no shortage of information. Monday – Euro- zone Retail Sales, earnings from Microsoft, and Texas Instruments; Tuesday – UK GDP Results, US Durable Goods Orders, US Consumer Confidence, earnings from Apple, Yahoo, Procter & Gamble, Caterpillar, and Pfizer; Wednesday – Australian Consumer Price Index, US Federal Reserve Policy Announcement, New Zealand Monetary Policy Statement, Japan Large Retailer’s Sales, earnings from Facebook, Qualcomm, and Boeing; Thursday – German Unemployment, German Consumer Price Index, US Weekly Jobless Claims, Japan National Consumer Price Index, earnings from Alibaba, Ford, Amazon, Google, and Visa ; Friday – Euro-zone Consumer Price Index, US GDP, earnings from Chevron, Honda, and MasterCard.
The ranges for the week are as follows:
| ETF Ranges for Week Ending January, 30 2015 | |||
| Ticker | Ticker Name | Lower Range | Upper Range |
| SPY | S&P 500 ETF | $200.50 | $208.00 |
| QQQ | NASDAQ-100 ETF | $102.10 | $106.50 |
| IWM | Russel 2000 ETF | $114.90 | $120.70 |
| TLT | 20+ Year US Treasury ETF | $132.50 | $137.70 |
| USO | US Oil ETF | $16.50 | $17.50 |
| GLD | Gold ETF | $122.10 | $128.10 |
If markets slow a bit because of inclement weather in the financial hub of the US, take advantage to make sure you are sticking to your new year’s trader resolutions. Do not fall into a panic mode if you have more losses this year so far. The year has just begun and it is important to remember that profits and survival require marathon like endurance. Make sure you are not getting wrapped up in any frenzies that are taking you away from your disciplined game plan.
Good luck and trade rationally.