12:34PM EST Buy Alert : New Up Segment is starting. We are going to start scaling into TQQQ and TNA.
Please register here to get access to member area with full discussions including price levels to monitor for. ------------------------------ Morning guidance: $SPX $NDX $RUT are all likely to drop down to new lows between today and tomorrow. Here are their next support levels. $SPX: 2780 to 2790 $NDX: 7200 to 7250 $RUT: 1500 and 1505 To get access to our daily trading plan for members where we discuss a lot more information, please register here. It's free with just your email. No credit card or personal information required.
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$SPX $NDX $RUT are likely to find temporary support at yesterday's low. They are likely to rise to the 1st level of resistance today:
$SPX: 2840 to 2845 $NDX: 7434 to 7450 $RUT: 1546 to 1550 To read the rest of this post for discussion of more support levels and whether or not market is ready to recover from here, please register here. It's free with just your email. No credit card or personal information required. US and China are at a deadlock over trade negotiations on Sunday. US is demanding promises of concrete changes to Chinese law. China responded by saying it would not swallow any "bitter fruit" that harmed its interests.
As of right now, S&P future is down 1.07% and Nasdaq future is down 1.27%. Prospects for a drawn out trade war between the two biggest world economies are making traders very nervous. It is tough to trade in this environment, especially for short-term traders. To make the right trading decisions, we ourselves rely on our system short-term indicators for the true story, as opposed to the surface emotions. To read the rest of this post, including our discussion on long-term signals, and to get the updated trading plan, sign up here. You will get free access to our member section. No credit card or personal information is required, just your email. Also, take a look at our trading record which has locked in 43.22% profit since start of March. If you like what you see, read more about our trading strategy here. According to Wall Street Journal:
"The Trump administration raised tariffs Friday on $200 billion of Chinese goods, sending tremors beyond the world’s two leading economies through Asia and Europe... Globalized trade means the bilateral spat is dealing a blow to economic growth world-wide. The International Monetary Fund in April reduced its growth forecast for 2019 to 3.3%, down from 3.6% last year, and said trade tensions could weigh on it further." To tell you the truth, we were really hoping for a quick gap down to the low of yesterday, combined with some more panicky headlines to set up the start of a new Up Segment. Prices are still up closer to the high of yesterday. Beware of head fake. Today's trading actions will make clear whether market participants are going to shrug off this potential start of a trade war, or if reality will sink in at some point and this current Up Trend that started on 12/26/18 will end. To read the rest of this post, including our discussion on long-term signals, and to get the trading plan for next week, sign up here. You will get free access to our member section. No credit card or personal information is required, just your email. Also, take a look at our trading record which has locked in 43.22% profit since start of March. If you like what you see, read more about our trading strategy here. We want to extend a warm welcome to all our new readers who just signed up in the last two days.
Latest Developments You probably have read by how Trump's comments apparently emboldened China to take a harder line on trade talks. According to Wall Street Journal: "In particular, these people said, Mr. Trump’s hectoring of Federal Reserve Chairman Jerome Powell to cut interest rates was seen in Beijing as evidence that the president thought the U.S. economy was more fragile than he claimed." Even though negotiations are scheduled to resume tomorrow Thursday, the expectations and the stakes have changed significantly. The US has filed paperwork for the 25% tariff to go into effect on Friday. The odds of a trade deal on Friday is practically zero. So what are the take-aways for us traders from this latest development? Lesson 1: Don't play poker with big stakes, employ bluffing and trash talk at the same time. Can you imagine tweeting about your hand while at the poker table? That's pretty much what happened. Lesson 2: Be patient and let the poker players go through their motions. Let market sentiments settle down a bit. Enter only low-risk, high-reward, high-probability setups. Don't overtrade. This is a highly volatile market. Short-term Signals Late in the day today, we wrote this in our intraday comments: "3:45 PM EST Don't hold long short-term positions of $SPX $NDX $RUT tonight. Looks like a drop tomorrow to Tuesday lows again." What suddenly caused us to change our mind? Our short-term signals turned bearish in the last 30 minutes. And as we write this at 11:00 PM EST, S&P 500 and Nasdaq 100 futures are both down close to 0.6%. The odds of market being down tomorrow is quite high. To read the rest of this post, including our discussion on long-term signals, and to get the trading plan for tomorrow, sign up here. You will get free access to our member section. No credit card or personal information is required, just your email. Also, take a look at our trading record which has locked in 43.22% profit since start of March. If you like what you see, read more about our trading strategy here. On Monday 5/6/19 evening, we wrote in our Trading Plan for members:
"$NDX failure to rise, combined with our other bearish short-term indicators, tells us that $NDX is unlikely to rise above very strong resistance at 7852, without first revisiting the strong support level of 7500.... TQQQ tracks $NDX performance. TQQQ is likely to drop down to test the support in the zone of 59 to 60, before being able to surge up through resistance 67.9." $NDX and TQQQ all dropped hard today Tuesday 5/7 as we predicted, along with $SPX $RUT IWM TNA SPY. $NDX dropped to an intraday low of of 7573, while TQQQ dropped to an intraday low of 60.64. They both came close to the lows we highlighted above. Based on this anticipation, we made over 5% profit today trading UVXY intraday for a short ride up. See our intraday description of that trade here. And it appears that a number of our members made a good profit from UVXY as well. Congratulations! So have $SPX $NDX $RUT found support yet? Are they going to bounce tomorrow Wednesday? You can sign up here to get free access to our member section right now. No credit card or personal information is required, just your email. Also, take a look at our trading record which has locked in 43.22% profit since start of March. If you like what you see, read more about our trading strategy here. UVXY gapped up and rose up sharply this morning.
We alerted our members last night to expect $SPX $NDX $RUT to go down. As the indices go down, volatility $VIX $VXN rise, and UVXY along with them. Check our intraday comments here. We are opening up member area to the public today for one day test drive. Learn more about UVXY and how to trade it. You can sign up here to start subscribing to our emails for free. No credit card or personal information is required. Also, take a look at our trading record which has locked in 43.22% profit since start of March. If you like what you see, read more about our trading strategy here. Good luck trading! Right now, we are opening up access to the members area of our website to the public. We'd like for you to see the information we typically provide our members to prepare for the next trading day.
It's been a lot of ups and downs since FOMC announcement last week 5/1/19. We had the late day trade tariff tweet on Sunday that sent market into a tizzy. The question now is how to prepare your trading plan for tomorrow Tuesday. Take a look here! A reader wrote to us after FOMC announcement to say:
"Thank you very much. 🙏🏻 God bless you. You are a gift for a new trader like me. Took profits today early morning on my investments and then watched the show down in afternoon. 🙏" - Abhi P We are very happy to hear that our market analysis and timely alerts helped our readers to lock in profits like this. Our short-term indicators turned bearish last week. In turn our readers were warned about the gap down on Mon 4/30/19. They were also warned about the high probability of a bearish response after FOMC announcement. That's how our reader Abhi knew in advance to take his profits and stayed out. Getting back to the market actions, the question on trader's mind is this. Is today's sell-off the start of a down trend? Or perhaps just some short-term profit taking? On the surface, it seems like just short-term profit taking. A knee-jerk reaction to some benign worries. Perhaps! We discussed in more details a couple of scenarios to look for, how to trade the market for the short-term, as well as what to do about long-term investments such as 401k plans. You can sign up here to start subscribing to our emails for free. No credit card or personal information is required. Also, take a look at our trading record which has locked in 43.22% profit since start of March. If you like what you see, read more about our trading strategy here. |
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