Hot Payrolls Number Pushing the Yields Up
This week’s market action tracked our trading plans almost to the letter, especially on a day-to-day basis! We wrote in our trading plans published this Monday, 01/31: “…Any remaining strength of the bulls will be likely tested from Wednesday, 02/02”. And, on Wednesday we wrote: “Today is that day when we will get an idea of how much juice is left in the “bounce back” from recent lows”.
With Facebook/Meta induced rout yesterday, followed by after-market bounce from Amazon’s and Snap’s earnings…nothing really might matter that much when the macro environment is turning into head winds for the markets. At this point, it’s all going to be about interest rates, inflation, and interest rates!
Positional Trading Models: Following the trading plans of yesterday, our positional models went short on a break below 4540 at 10:32am, with an entry of 4535.44 and a hard stop at 4588. This morning, the models are tightening the stop-loss to 4522, locking in a profit of at least 13.44 points IF hit.
If not closed out, models will carry the short into the weekend. If carried overnight, the stop-loss will remain active with a futures-equivalent stop-loss level of 4512 during Sunday overnight hours.
Intraday/Aggressive Models indicate the trading plans below for today:
Trading Plans for FRI 02/04:
Aggressive Intraday Models: For today, our aggressive intraday models are in an indeterminate state. Consequently, there are no intraday trading plans for today.
To avoid getting whipsawed, use at least a 1-minute closing or a higher time frame – depending on your risk tolerance and trading style – to determine the signals.
IMPORTANT RISK DISCLOSURES AND NOTICES – READ CAREFULLY:
(i) This article contains personal opinions of the author and is NOT representative of any organization(s) he may be affiliated with. This article is solely intended for informational and educational purposes only. It is NOT any specific advice or recommendation or solicitation to purchase or sell or cause any transaction in any specific investment instruments at any specific price levels, but it is a generic analysis of the instruments mentioned.
(ii) Do NOT make your financial investment or trading decisions based on this article; anyone doing so shall do so solely at their own risk. The author will NOT be responsible for any losses or loss of potential gains arising from any investments/trades made based on the opinions, forecasts or other information contained in this article.
(iii) Risk Warning: Investing, trading in S&P 500 Index – spot, futures, or options or in any other synthetic form – or its component stocks carries inherent risk of loss. Trading in leveraged instruments such as futures carries much higher risk of significant losses and you may lose more than you invested in them. Carefully consider your individual financial situation and investment objectives before investing in any financial instruments. If you are not a professional trader, consult a professional investment advisor before making your investment decisions.
(iv) Past performance: This article may contain references to past performance of hypothetical trades or past forecasts, which should NOT be taken as any representation or promise or guarantee of potential future profits. Past performance is not indicative of future performance.
(v) The author makes no representations whatsoever and assumes no responsibility as to the suitability, accuracy, completeness or validity of the information or the forecasts provided.
(vi) All opinions expressed herein are subject to change at any time, without any notice to anyone.
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