INTRADAY ALERT – FRI – MODEL POSITIONS PROFIT UPDATE
In our S&P 500 OUTLOOK for FRI, published last night, you read: “For Friday, the aggressive/intraday models indicate indeterminate bias between 2720-2700 – stay flat between these levels. Above 2720, long bias with very tight stops/trailing stops (5 to 8 points, to make sure the models don’t get stuck in swiftly losing positins on a Friday). ” (click here for the full report)
Accordingly, our intraday/aggressive models went long the index futures overnight (at 2724, a rough equivalent of the index at 2722.50 currently) – our index/ETF models have gone long (bought) on the open at 2727.50 level on the index (index at 2736.44 as of this writing, 10:03am EDT).
Models are closely monitoring the price action to determine the profit taking level. Indications are for a strong resistance into the 2740-45 area on the index.
Models currently have a take-profit sell order at 2740 (could be premature, but would prefer to take profits early and not get exposed to potential wild gyrations on a Friday afternoon session which can go either way).
Also, models have a stop loss at 2730, to lock-in a modest 2.50 points profit in the worst case.
NOTE: It is important to note that today is the quarter end and the market action could potentially include some “window dressing” component in it. Monday could see a down move, with such artificial upward pressure off. Hence, our models prefer to take the profits early and small than try to ride for a big payoff.