SPY Thoughts October 9

**These were my thoughts on the SPY ETF to subscribers in my Daily Trade Ideas which includes many, many more charts and setups**

An ugly day again and things are not looking great at all for the indexes.

I’m all out of all longs here now and only have a good sized SPY short on but I did cover half of it near the close today as we are right at the 100 day average on the SPY.

Our short level was hit Monday as the SPY broke the 50 day average at $167.50 or so.  A quick $2 in a day is fine by me.

I’ll look to get short again after a little consolidation here most likely.

I’m not considering any longs here tonight unless they are inverse ETF’s or the like.

As I warned last night, taking profits early and raising stops was a good idea as we did with our positions and I cashed out of them all today even before stops were hit.

We are entering a very weak period by the looks of it.

It’s been a great year and if it ended today I’d be happy but we may get some really great chances to short over the next few days and weeks and shorting has often given me the best returns in the shortest amount of time.

Let’s check into the index charts here before looking at some stocks and perhaps even a few that look decent on the short-side.

SPY October 9, 2013

Another very poor day here but great if you got short at our short level!

I’m looking for a move to the $164 area which would be the 50% Fibonacci retracement level, or perhaps quite a bit more, only time will tell but for now we hit the 100 day average at the close on heavy volume which is the 38% Fibonacci level.

I prefer to see a bounce off moving averages in this type of situation but that did not come today.

I had to sell half my short at the close but in case we don’t rest here I held the rest.

I’m looking for a couple or few days rest here before we break lower again towards $164.

I’ll be exiting my short totally Wednesday if we don’t get below the 100 day at $165.46 within an hour into the day, or if we do move under there and then move back above it I’ll also exit and wait a few days to reload my short positions.

I did not see many great shorting chances last night but I expect to see more and more come in within the next few days.

Have a great evening and Wednesday.

Warren

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