Very positive price action this past week for those long in conviction and positions. The close above the 200-day simple moving average is indeed bullish, especially if it hasn’t been above that level in over a quarter or more. The average gain the next week is -.90% while the next month’s returns average +1.3%. Ideally we’d see an inside week with some range-bound trading and digestion of the gains over the past three weeks.

Next week brings the end of October and the start of one of the more positively skewed seasonal times in the market. It’s difficult to initiate new positions up here and also difficult to short this market. Those two thoughts are causing a lot of frustration for many which can lead to low probability trading if disciplined isn’t exercised. Those who shelf their opinions of what should be while creating objective trade setups should profit nicely in the coming weeks.

Many catalysts exist next week that could contribute to choppy trading. The week kicks off with the Chicago PMI on Monday followed by the ISM manufacturing PMI on Tuesday. Wednesday has the FOMC meeting along with the ADP data followed by the ISM non-manufacturing PMI on Thursday. Friday brings the week to a close with the non-farm payrolls and day two of G20 meetings that started on Thursday. Needless to say there’s a lot of potentiality out there for next week. Enjoy the links and your weekend!

  • What you want vs. how you get it [Intelligence Daily]
  • Test your brain starts Sunday night [NatGeo]
  • Fear, Greed, and Financial Crises: A Cognitive Neurosciences Perspective [Andrew Lo]
  • The Existence of a Hypnotic State Revealed by Eye Movements [PlosOne]
  • Big list of behavioral biases [The Psy-Fi Blog]
  • How listening to an iPod shrinks your sense of personal space [BPS]
  • Want to resist temptation? Don’t think about it. [Science Daily]
  • What kind of Buddhist was Steve Jobs, really? [Plos]
  • Happiness linked to personal time [Baylor Lariat]
  • Are you afraid to trade? [MoneyShow]