**These were my thoughts on the SPY ETF to subscribers in my Daily Trade Ideas which includes many, many more charts and setups**
“Always and never are two words you should always remember never to use.” – Wendell Johnson
Wow. What a huge overnight move in markets as a deal on a temporary debt ceiling extension looks to be in the works.
That said, I will not touch anything in this news driven market since we can gap open up 20 or 30 S&P handles, or vice-versa.
I have no problem waiting for a safer time to enter the market.
All I’ll be doing is perhaps some day-trading and I’ll tweet any I take.
I like when markets are choppy since I can get out of the office a bit more and enjoy the fruits of my labor.
Until we see a trend or a nice base emerge I’d not get too excited and remain mostly in cash but if you are trading, trade small.
Having all your capital to use when the easy trades come will get you to your goal much faster.
Let’s check the markets who have found some support as I mentioned was likely and also one thing to note is that in bear cycles the bounces come hard and fast but fizzle out quickly.
So far this is textbook action that we see in a bear cycle so it’s something to watch for.
Never forget that CASH is a position.
Let’s look at the index charts to being.
I tried to short SPY today as it fell of it’s 21 day average but ended up being stopped out at cost as the markets roared higher still.
It’s rare to see the S&P up over 30 handles, even 20 handles is pretty rare but we did today, up some 36!!
Of course 20 of those points happened pre-market so it’s not as strong a move as it may look on paper.
Volume was not as high as the down volume Tuesday so I’m not so sure about this news driven move.
I’ll not hold anything overnight I imagine until this market can show me it’s moving on it’s own, not on a news headline.
The chart does look like it’s going higher here all of a sudden though but I’m in no rush.
If it’s true and this wasn’t a correction after-all then we will have many much safer entry points in the days and weeks ahead.
Have a great Friday and weekend and enjoy your Thanksgiving Monday and turkey if you’re up here in Canada.