Newsletter of Danny Merkel - Issue #117

Apr 23, 2023

∙ Paid

Market Review:

A reoccurring theme recently is that the market has become “stuck” and this theme reached an extreme this week.

For the month of April the Nasdaq, shown below, has become unbelievably gridlocked. I’ve seen anything like this before:

Every dip is bought. Every rally is sold. The index on Friday was so massively pinned down that it could only manage a rally of 0.01%.

I could not possibly imagine a market environment less conducive to momentum trading than this.

Not only has momentum trading lost its edge, but it actually has a strong negative edge in this market.

In momentum trading hell, losses are pretty much guaranteed daily: