The markets are in a slumber
The deeper we get into this week, the quieter things seem to get…
In fact, it’s quite eerie that we have such little activity in the market, outside of a holiday period anyway.
The UK stocks I monitor have traded around a fifth of their average daily volumes and have posted average gains of just +0.10%, at the time of writing.
It’s enough to make a grown man cry!
All jokes aside, it’s quite disconcerting, and while this malaise will likely have longer to run – given what’s going on in the world at the moment – I can’t believe there isn’t an event round the corner that will jolt the market out of its slumber.
That said, even the unexpected turn of events in Washington DC overnight has not elicited much of a response, when perhaps it should have.
After all, it’s not every day that the President publically fires the head of the nation’s principal crime fighting organisation whilst they are out on the road.
For now it’s being seen as a largely domestic matter, with US markets forecast to open modestly lower on the day, though there is likely to be further political fallout from this as the day unfolds.
But given that markets have chosen to largely ignore political risks so far in 2017, I would be surprised if it escalated from the market’s standpoint.
The one that got away…
Rather frustratingly, my trading model picked out TalkTalk as a potential sale trade, as the Telecoms provider broke back to bear trend – having traded well below its 20, 50 and 200 day EMA lines in Monday’s session.
Unfortunately for my Trading Point Pro members and I, the company reported full year figures first thing this morning, so there was no window of opportunity in which to act in.
After this price action you won’t be surprised to hear that the figures were disappointing. In fact that’s an understatement to say the least…
Because the full year dividend was cut by 50%, as the business seeks to retrench under its new CEO and Chairmen (each of whom have only been in the job for a month).
The stock gapped lower by -10%, to 160p, from the open today, further compounding the issues that have dogged the Telco sector in 2017.
We will have to file this under “one that got away”, and try and take some comfort from the fact that the model at least flagged the potential for this collapse in the price – even though we didn’t get a chance to act on it, on this occasion.
Without wishing to rub salt into the wounds here is the TalkTalk chart, as of the close of play last night:
It’s a textbook sell: note the rejection at 200p and the break below the moving averages and the uptrend from the February lows.
Timing is everything of course and in this case time wasn’t on our side.
However, we do have time on our side for a potential play on another stock…
And I’ll be emailing all my Trading Point Pro members about that very shortly.
If you want to join them and getting involved in future trades my model identifies…