Tuesday Morning Briefing

Welcome to our morning briefing. Here we are reviewing short term setups ahead of the NYSE opening bell. If you are a scalper or swing trader then these setups may be of interest to you. As usual keep in mind that these are short term setups although they could be used as early entries for more longer term positions.

I have to see my chiro early this afternoon (your morning) so I won’t have time for a full fledged daily briefing. So let me give you the skinny in preparation of today’s session. Obviously we’ve seen a big move yesterday and it’s not unreasonable to expect an attempt to recover some lost ground. Short term all the index futures look identical this morning so I’m only showing the spoos. As you can see the 25-hour is falling quickly now and overnight the E-Mini has been pushing sideways. I expect it to catch up with the SMA shortly – probably somewhere around 1743.75 give/take a few ticks.

You recall that I took short term profits (not my daily positions) in expectation of a counter response. That however does not mean it necessarily must happen today – the 25-hour will be the first hurdle that has to be overcome. If you see the spoos or any of the others hop over successfully then you know the bulls are ready to launch a counter strike.

Whether we see a bounce today or not, medium term nothing really changes as I will hold my current short positions all the way to ES 1760 where they triggered. That’s actually not too far away but I made my 1R and thus the stop had to be moved near the entry, per the rules. It is possible that 1760 will be breached and we then fall back below and it will take a bit of finesse to deal with that should it happen.

There is no technical context on the daily/weekly/monthly that offers any further clues right now, so don’t let your emotions/imagination fill in the gaps. All we know is that the fear factor on the CPCE was back below a threshold that suggests a short term bounce. We can prepare for that but if we want to hold positions through a big correction then a hands-0ff approach is usually the best policy.

Have fun but keep it frosty. I see you guys later this afternoon should I survive the crushing plate size hands of my chiropractor.

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Cheers,