The general market has been stuck in a range for a while. A short term trend following system will fail miserably in a situation like this. Oscillators, pivots , support and resistance work better here.
The overall market sentiment is perhaps still slightly bearish mainly due to the problems in Europe. So we can pay attention to how EURO is doing. EURO has been rebounding from the bottom nicely during the past 3 weeks. If it continues, it will help the stock market move up too. Or it will at least ease the downward pressure on the stock market.
The stock market is approaching a key support area. As we can see from the chart below, support A and B were both valid. If you had gone long on these key points, you would have profited nicely. What about this time? Would you want to go long from here again?
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