Software & Finance - Monthly Magazine Online

Volume 4 - Issue 7

July 2014

Time to Short Market now?

June 27, 2014 - Dow Jones Index closed today at 16851.84 and it is just 127 points below all time high. Speculators are so crazy and wants to touch at least 17000 one time before do see a major sell off.


When the Fed speculates that the rate hike is possible in early or late 2015, it is confirmed that the 35 billong $ bond buying programme will stop towards end of the year completely. Market takes the negative news as positive since the Fed can continue fueling the economy. Besides Market is also taking the positive news as positive since it is positive.


In either case, bulls are in full control to move index up. But russell index is failing to make a higher high and keep seeting lower low signals that the severe market correction is imminent. Perhaps it will end up in putting the index into bear market territory.


If you have short position, you can continue to accumulate on each and every rally. But if you have long position, you need to exit the market as quickly as possibly.


Since the rate hike is certainly indicated on Fed's policy, it will trigger the home prices to go down. That can accellerate the sell off. It is the only the question of when the market sell off will happen and not how?


Take care longs!