TVO Market Barometer 5/4/17: You can learn a lot from not listening.

Most of the peers of the great saxophonist Sonny Rollins are long gone, so just about all the musicians he plays with nowadays are far less experienced than he is. He was once asked, “Sonny, how do deal with folks like that?” He replied, “Well, I just don’t listen to ’em.”

After almost 2 frustrating weeks of sideways motion, earnings reports, the Fed, etc., with both bears and bulls giving a pretty good argument for their case, perhaps the best course of action is to simply not listen (or not watch the screen) and just follow your instincts. Or in the case of technical traders, follow your system.

Volume momentum is quite strong as TVO ripped from below 0 to +3.3 in a matter of days, sending our General Investment Strategy back into “sell” mode (with barely a 10 cent gain on SPY). But why sell if momo is on your side? Our GI is highly protective and designed to build capital slowly over time and will often get us out before the chase really kicks in (my IRA is on the GI plan).

Our SPY call options, on the other hand, that we’re still holding from March, have been weathered down by low volatility, and while SPY has gained over 4 points, they’re up just shy of +6%. Of course all of that could change after the job numbers… or not. No matter how much experience you have, there’s no way of knowing the outcome until after the fact, so always carefully manage risk and try to avoid “going all in.” And if anyone tells you otherwise, don’t listen to ’em. -MD

To view past positions check out our Trade History.

To find out what the indicators mean, here's our TVO System Dashboard Terms Explained.

To learn more about market volume, The Total Volume Oscillator, or How We Trade, find us on Twitter (@TradingLicks) and StockTwits!

The indicator descriptions in the above graphic represent general market sentiment and are not the actual TVO System signals. To view today's active signals and options trades, please . Not a Member? Join us.