It’s very tempting to start looking for long entry opportunities after a series of nasty sell off. Clearly there couldn’t possibly be more selling around the corner after an entire month of upside progress has been wiped out in a matter of days, right? WRONG. Gauging downside price action by comparing it with upside price action is a flawed perspective that has cost the trading accounts of a many traders.
Things are getting more tricky again on the equities side. If you followed along in the comment section during yesterday’s session then you know that I took out a long position courtesy of our famed Zero indicator, which stepped up the occasion and cut through all the noise as usual. This morning the main question for me was whether to hold long or to exit and consider taking out a short position.
And not in a good way, I may add. I just checked the event log for the remainder of this week and it looks rather petrifying: Starting tomorrow one market moving event after the other, and given the current frailty in equities the potential for continued hilarity can not be ignored. FYI – I didn’t include the core consumption expenditures report today as that one will already be priced in by the time you read this.
Happy Monday everyone! I am happy to report that several of the entry opportunities I posted last Friday are faring well with hopefully more ill-gotten gains beyond the horizon. On the equities side the E-Mini is getting ready to put the squeeze on whoever remains short at this point. And let me tell you right now – if you are a bear, or are still holding short, you are probably not going enjoy this post.