Free Daily Stock Market Direction
from Stock Trading Warrior

Stock Market Direction
for the week of May 17, 2021.

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RED

The market is trending down.

YELLOW

Market trend is slowing, changing direction or nontrending.

GREEN

Market is trending up.

The markets are not treding. Take no new positions until the markets are moving in a trend.

No guessing. No speculating. Stock market direction is determined by what is ACTUALLY happening in the markets. Is buying or selling occurring? This real FACT determines the market direction investors or traders should be focusing on and how to invest or trade.

What Does Each Signal Mean?

RED

Signals a market downtrend. Taking new long positions should cease until the market direction changes. If you're comfortable shorting, a red signal is a good time to do so.

YELLOW

Signals a possible change in direction or a nontrending environment. Stop taking any long or short positions until the markets indicate a trend direction - unless you have a specific short-term strategy. A yellow signal can also indicate a volatile market which is difficult to trade in successfully.

GREEN

Signals an upward trending market. Taking new long positions is acceptable. Short positions should be avoided when the market is in an uptrend.

Why You Should Care About the Stock Market's Direction

The reason to be concerned with market direction is that it gives you an opportunity to take advantage of the direction in which the markets are moving. Trading with the trend direction will give your trades an additional boost. Additionally, the idea is to enter new positions during a trend to buffer any downside movement as well as take advantage of any momentum in the markets.

The hard truth is that most of us aren't wealthy enough or have the kind of capital that institutions or funds have to make the markets move in one director or another. We aren't market movers. However, we can take advantage of the large-scale signals that the markets provide.

How is the Trend being Read?

The trend is being read using several indices: New York Stock Exchange ($NYSE), NASDAQ Composite ($COMPQ), Dow Jones Industrial Average ($INDU) and the S&P 500 ($SPX) which is a good index to use for reading the general market trend because of the broad range of stocks that are included in the index.

The indicators that are used are the Average Directional Index (ADX) along with the ADX's +/-DI and moving average lines. Price and volume also play a role.

Why is this Service Free?

Great question. First, I look at the market direction every day, and it's a fairly simple exercise to the trained eye. If you're just learning how to read market trend it's an easy way to follow along.

How Do I Learn How to Read Stock Market Trend?

If you're interested in learning how to read stock market direction and trend on your own please read Look at Stock Market Trend Before You Buy Stocks. This webpage introduces some good technical indicators to use for reading market direction and some other indicator tools that can help determine the mood of the markets.

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