BULLS SHOWED UP TODAY

I've been sick over the last few days so this posting will be brief. After the gap down this morning, the buyers came in and managed to cut those losses significantly. The price action was definitely bullish. The volume was above average so we can't ignore or brush off the move. There is a good possibility that the market will be up tomorrow. Having said that...there is still a lot of uncertainty as to the future economic outlook. Like I've said before...if we do move higher, I don't expect it to be too much higher. The reward to risk still favors the bears. I wouldn't be surprised if we got a complete reversal of today...a gap up followed by a big sell off. Either way, I'm not too worried since I only took on a small position as we broke below 110 on the SPY. I'm still looking to take on the larger position when we break below 108. This is one of the benefits of waiting for confirmation. Those that have already entered trades need to make sure they follow their trading plans. I had a few e-mails asking me if they should stop themselves out early because of today's move. I'm not a big believer in changing the trading plan after you are in the trade. The decisions you make after you commit capital to a trade are usually bad decisions. If you fully accepted the risk before you entered the trade, you should be willing to remain in the trade until either of the parameters are met (getting stopped out or hitting your profit target). The whole reason why you set up a plan for your trade is so that you won't act emotionally to every gyration of the stock (or market). Although the move today was somewhat bullish, a move like that still need another day to confirm it. The market hasn't yet broken above any key resistance levels so there's no reason to panic if you are bearish on the market. Remember...we don't care where the market decides to go. We can't predict it (at least not perfectly), we can't wish it or hope it, and we definitely can't control it. If we lose money on this expected move, we will make it up somewhere else. Don't make the mistake of believing that this expected move down will be the only chance to make money. The market is always presenting opportunities to make money. However, we need to be patient and make sure we are following sound money management principles. Money management is the most important part of trading...I know I've heard that somewhere before. Unless something big happens, this will probably be my last posting of this week. I'm miserably sick and I barely have a voice so I'm taking the weekend off to recuperate. Have a great weekend and send me your success stories if you have some...although I'm aware that I will probably get flooded with them as soon as the market drops 300 points.