{"id":21556,"date":"2024-02-05T07:30:34","date_gmt":"2024-02-05T12:30:34","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=21556"},"modified":"2024-02-05T07:30:34","modified_gmt":"2024-02-05T12:30:34","slug":"this-simple-rule-tells-you-if-the-market-is-bullish-or-bearish","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/this-simple-rule-tells-you-if-the-market-is-bullish-or-bearish\/","title":{"rendered":"This Simple Rule Tells You If the Market Is Bullish or Bearish"},"content":{"rendered":"

Trade the market in front of you, not the market you want to see.<\/p>\n

This is key if you want to make money over time as a trader.<\/p>\n

We all have biases. These are present in every part of our lives – including when we trade.<\/p>\n

For example, I’m naturally bearish. I’m always looking over my shoulder waiting for the market to drop.<\/p>\n

If I let that bias influence my trades all the time, I would have gone broke a long time ago.<\/p>\n

That’s why, as difficult as it is, it’s important to approach trading with as neutral a perspective as possible.<\/p>\n

That means using a systematic approach<\/em> to market analysis.<\/p>\n

For me, that means letting a simple rule, not my natural bias, determine if the market is trading bullishly or bearishly.<\/p>\n

Today, I’ll show you what that rule is… and how you can apply it to your own trading.<\/p>\n

We’ll also look at why this rule means I’m trading stocks bullishly right now.<\/p>\n

Figuring Out the Market’m Mood<\/h2>\n

To help me figure out the mood of the market, I use something called a simple moving average (SMA).<\/p>\n

If you’ve been trading for some time, you’ll know what this is. But if you’re still finding your feet as a trader, let me explain…<\/p>\n

The SMA shows the average stock price over a specific period. It smooths out the daily ups and downs to give you a clearer long-term trend.<\/p>\n

If the market is trading above its 20- and 50-day SMA, I maintain a bullish stance no matter what.<\/p>\n

It’s only when the market breaks below both SMAs that I look to play the downside.<\/p>\n

If the market is in between the SMAs, or above one but below the other, take a more neutral approach.<\/p>\n

So, where is the market now according to this framework.<\/p>\n

<\/p>\n

\n
\n

Free Trading Resources<\/strong><\/p>\n

Have you checked out Jeff’s free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career \u2013 at zero cost to you. Just click here<\/a> to check it out.<\/p>\n<\/p><\/div>\n<\/div>\n

<\/p>\n

This Market Is Still Bullish<\/h2>\n

It’s all in the chart below of the blue-chip S&P 500 index.<\/p>\n

It tracks the average performance of the largest 500 stocks in the U.S. That makes it a great barometer for the U.S. stock market.<\/p>\n

<\/p>\n

\"Image\"<\/p>\n

The black line on the char tis the S&P 500. The blue line is the 20-day SMA. And the red line is the 50-day SMA.<\/p>\n

As you can see, the S&P 500 is above both these lines.<\/p>\n

That means my rules prevent me from loading up on bearish trades.<\/p>\n

Until we break below both those SMAs, I’ll be looking to play the upside with my trades.<\/p>\n

That means trading stocks that have room to continue going higher.<\/p>\n

And I recommend you do the same… no matter what your gut is telling your to do.<\/p>\n

Happy trading,<\/p>\n

\"Signature\"<\/p>\n

Imre Gams
Analyst, Market Minute <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Trade the market in front of you, not the market you want to see.<\/p>\n","protected":false},"author":55,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[76],"newsletter-type":[],"ticker":[],"class_list":["post-21556","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-imre-gams"],"acf":[],"ai_tts_audio_outdated":false,"ai_tts_legacy_post":false,"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/21556","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/55"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=21556"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/21556\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=21556"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=21556"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=21556"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=21556"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=21556"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=21556"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=21556"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}