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Timing stock market tops and bottoms is risky business and we all know the more the more risk we take the more potential gain would could also make. Correctly timing a top or bottom for any investment is flat out exciting not to mention financially rewarding. But this high risk trading tactic does come with some major issues which you must FULLY understand so that you can protect your capital and self-confidence.

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Is Tech About To Lead The Market Lower?

Posted by johnrothe on October 15th, 2012

 

Some quick thoughts on the market:

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The markets are taking a beating today. The SPDR S&P 500 ETF (NYSEARCA:SPY) is trading at $130.44, -1.76 (-1.33%). While things look ugly, there is a major silver lining showing up. This is a positive divergence between the markets and the U.S. Dollar.

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Once again, the U.S. Dollar Index (DX-M2) is declining lower after the opening bell rings at the New York Stock Exchange. This happens very often when the major stock indexes are breaking lower. You see, when the dollar declines everything in the stock and commodity markets will inflate and trade higher. Just the opposite will happen when the U.S.

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The markets surged higher as expected today. This was a result of a technical level hit on the NASDAQ 100 yesterday when the PowerShares QQQ Trust, Series 1 (ETF) (NASDAQ:QQQ) tagged a low of $65.25. This price happened to be the 50 moving average on the daily chart. Based on the dramatic fall in stocks like Apple Inc.

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The markets opened nicely higher only to get slammed once again. Last week the markets saw their largest decline of 2012. The down cycle called by Chief Market Strategists at InTheMoneyStocks is fully in play. European worries continue to increase and technology has seen a sharp pull back from its recent highs.

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