Equity Campaign Update

If you’re a sub then you may have followed me into two equity setups yesterday near the close. More specifically I was looking for speculative long entries on the NQ and the TF. Thus far the risk of a shake out here is still high, so let me share my current outlook on things and more importantly where I have positioned my stops:

On the TF I got in near the 1130 mark per the 25-hour SMA and Net-Line Buy Level (NLBL) breach. That’s bullish and unfortunately the only technical entry on the roster at that moment. My stop is very near and the idea here is that the 25-day has to finally act as support now – if it gives then we’ll probably correct a bit deeper and we’re going to be looking for renewed long entries in a day or two.

Similar situation on the NQ – here my stop is a reasonable distance from the magic 3600 mark. We’re holding thus far but once again the odds are still 50/50 on whether we continue higher here. Signs of a little shake out were on the horizon and that means we need to stay nimble. The reason why I am taking these lottery tickets is that they are pretty cheap and because we are at an important inflection point. Everyone who has expected a correction wants to be long now and is waiting for a dip to enter – which is why exactly there is the possibility of the bus leaving the station fairly empty.

Bottom Line: If being stopped out I will look for new entries a bit lower. If we continue then I will build up my positions at each 1R I earn. Either way I think the tables have turned and the bears are going to be burned here. They had multiple opportunities to take the tape lower and blew it each single time. And as always failure of seizing an opportunity means there is going to be a price to be paid.

Message to the bulls: If you blow this one then it will represent exceptional weakness and the bears are going to rape you. SPX cash needs to remain above 1880. The onus is on you to drive this sucker into new highs now.

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Cheers,