Ep. 301 Look For Changes In The Market With These Strategies and Signals
Investing With IBD
Deep Dive
Why is Irusha Peiris not focusing on tax loss harvesting as part of his trading strategy?
He acknowledges its potential impact on the market but doesn't make it a significant part of his strategy. He prefers to rely on price and volume signals rather than seasonal or tax-related factors.
What key market indicators did Irusha Peiris mention as damaged during the recent market downturn?
The NASDAQ and S&P 500 both broke below their 21-day and 50-day moving average lines, indicating significant damage to key support levels.
How did Irusha Peiris assess the recovery potential after the market damage?
He noted that the NASDAQ managed to recover above Friday's high, and the S&P 500 closed near its high, suggesting progress in the recovery process.
What advice did Irusha Peiris give regarding stocks that broke support levels?
He advised respecting those stocks and letting them set up new bases before considering them again. He emphasized the importance of managing risk and being cautious with such stocks.
Why did Irusha Peiris become more cautious about the market?
He observed that many stocks, including small and mid-caps, broke their 50-day moving averages, indicating broader market weakness. This led him to scale back and raise cash in his portfolio.
What market condition caused the PowerTrend to go under pressure?
The PowerTrend went under pressure due to a distribution cluster, with four distribution days occurring within an eight-day span, particularly on a heavily traded day following the Fed meeting.
What sectors did Irusha Peiris identify as potentially weak or underperforming?
He mentioned energy, healthcare, financials, industrials, materials, and retail as sectors showing signs of weakness, with many breaking key support levels.
How did Irusha Peiris describe the common trait among successful traders and analysts?
He highlighted their passion and curiosity for the market, noting that they are excited about trading and often incorporate market insights into their daily lives.
What lesson did Irusha Peiris emphasize about market corrections and cycles?
He stressed the importance of staying in the game during tough market conditions and being patient for the right opportunities. He noted that success often comes to those who endure multiple market cycles.
How did Irusha Peiris describe his approach to market valuation and overthinking?
He admitted that overthinking market conditions often leads to being wrong. Instead, he prefers to focus on what the market is actually doing and let it guide his decisions.
Shownotes Transcript