2022 Lessons for 2023 Trading.

(More is in sync than headlines reveal) [image] Broad Markets – What Are They Telling Us? The first lesson drilled into my head after losing big in early 2009 is that the odds of success in trading equities are increased when the broad indices (S&P 500, Dow 30, and Nasdaq 100) are moving in the same general direction. At first glance, all three are testing horizontal support; they are in sync. They are so much in sync that one strong move by one player in any direction could really pull the other two. It’s something to pay attention to, because it could happen any day or in the next few weeks before the new year. Just look at the these three charts showing the Dow, the S&P and the Nasdaq, respectively: [image] [image] [image] Relative Strength There’s something else worth noting: the 200-day moving average (the other line on the charts). “Technically” the Dow 30 is just about out of a bear market with its steady pricing almost 25% above the recent 28.635 low. The S&P 500 is holding the 200-day line, and the Nasdaq 100 is definitely lagging underneath it. So why is the Dow 30 so strong in this bear environment? Is the energy sector really the only one doing the heavy lifting? The Components Based On Time Here are the components and their sectors. Currently the Dow represented by the ETF DIA is only 6.5% down for the year while energy is leading the index with a 44.9% YTD return based off CVX. [image] [image] But check out MRK, check out the whole Healthcare Sector for that matter. YTD gains are 4.5%, 42.3%, 9%, 23.9%. How about MCD and KO? CAT is up 12%, TRV is up 19%, tech company IBM up 11% YTD. Those stocks are not in bear markets, but it hasn’t been a straight up year for them either. [image] [image] [image] The Conclusion These are just Dow 30 stocks, there are more stocks with 2022 stories. Trade the strongest stocks to the upside and the weakest stocks to the downside during almost any market condition in any given year. As we approach Christmas and the end of the year… Watch out, don’t cry, don’t pout, I’m telling you why… Markets are always moving. Opportunities are always there. You just have to have a way to find them. I believe you can! Think and win, Celeste Lindman Ask The Pros RISK DISCLAIMER There is a very high degree of risk involved in trading. Ask The Pros and all individuals affiliated with this site assume no responsibility for your trading results. The indicators, strategies, columns, and all other features are for educational purposes only and should not be construed as advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. [Unsubscribe]( DTI Trader 1555 University Blvd S Mobile, Alabama 36609 United States (251) 652-1555