**These are my thoughts on the SPY ETF in my Daily Trade Ideas which includes many, many more charts and setups**
You miss 100% of the shots you don’t take. –Wayne Gretzky
What a bloodbath Friday was.
Markets fell heavy and hard.
I tried some shorts and some longs with mixed results but losses were very small and the gains outweighed them, but not by a lot.
I had a nice short early in the day and should have held it since we closed on the lows much lower than I’d expected.
Seeing the S&P off more than 30 handles is very rare but we did today and on very heavy volume.
After a year or so straight up, we are now ready for a nice correction that could last a couple months before we begin to turn higher once again.
Let’s check the charts and begin with the break of the megaphone pattern I’ve been showing and talking about for a week or more now.
Often when markets gap down 2 days in a row it’s a buy signal. That was not the case today.
To be honest I didn’t short at the break of the 50 day average which was the short level.
I was too scared.
With markets already off heavy Thursday I just didn’t have it in me to really get short with any conviction considering how strong we’ve been in the last year.
Basically I overthought it and while I didn’t pay the price, I did miss out on some sweet profits opportunities.
Scared money almost always loses and I was scared. I just didn’t see this drop coming so fiercely so quickly.
I was looking for a week or so of consolidation before we broke this bearish megaphone pattern but it rarely works out exactly how you plan.
We are definitely due for a bounce now and I have a few trades on from late in the day Friday that should take advantage of that if it comes.
I’d like to see the SPY move back up near $181 before I will consider shorting it.
Have a great weekend and use strength to exit positions if you still have any.