If you take a look at the Dow Jones (DIA) ETF you can see a rally that started in January 2014 and looks like five quarters of blow-off top that began at the end of the Subprime Crisis around February 2009. I fully expect a healthy pullback in the indices from today’s 180 level in the (DIA) .
Apple Joins the Dow
Be aware also that Apple (AAPL) was reported to be added to the Dow Jones today on a full moon, which would have sent my Astrological Trading Buddies through the ceiling. But adding Apple to the Dow was nessesary because the Dow Jones Industrial Average is one of several highly watched stock market indices created by Wall Street Journal editor and Dow Jones & Company founder Charles Dow. Dow compiled the index as a way to gauge the performance of the industrial component of America’s stock markets. It is currently the oldest continuing US market index and was first published on May 26, 1896. The DJIA represented the average of 12 stocks from various important American industries. Of those original 12, only General Electric (GE) remains part of the average. Now you can add the bellwether Apple to the 30 stocks. I learned simple trading tools from various experts and most of them are/were crazy as loons, but one of my original mentors (since passed away) would always use the phases of the moon to watch cycles, and it was easy because all u had to do was look outside on a clear night. Tonight is one of those nights.
Apple is also putting in a short-term high, and the markets are just walking in the shadow of iPhone production, Warren Buffet ($BRK.A) and Google (GOOG) aside. Markets pull back from longer-term advances in increments normally, and these pullbacks are also simple percentages like .382, Halfway and .618. If you want to start with Technical Basics, learn the Fibonacci Retracements because if you watch the pullback you will see the January 2014 level was almost spot-on .382 from the highs.
Trading the Market
Use all tools available to you when observing markets. Technical analysis, cycle work and painstaking fundamental scouring make the markets move slower than they look and on some days, events and actions seem to make sense, they seem to be coming across the plate like a beach ball. Trade a small number of stocks and become an expert in a handful of them, know who the insiders are and when they buy and sell stocks. This is all public information and readily available. But for tonight, just walk outside and look at the moon and know that during the next full-moon cycle, your stocks will not be where they are today.
DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer