Model Positions Based on The Forecast/Trading Plan Published Before the Market Open – THU 08/16:
Medium-term/long-term Investors
Forecast/Trading Plan:
The trading plan published this morning stated: “For today’s regular session, the medium term models indicate going long on a break above the index level of 2860, with a 10-point trailing stop. No bearish bias until all the way below 2820. Meditum-term models indicate waiting for a daily close below 2820 to turn bearish. “ (click here to read the full report/trading plan)
Market Action and the Outcome:
The S&P 500 Index has opened the regular session at 2831.44 and registered session high at 2850.49 and session low at 2831.44 (as of 12:30pm EDT) – well within the range of 2860-2820 monitored by the models.
Thus, the medium-term models are currently flat and are monitoring for a breakout in either direction on a daily close (hence, the medium-term models will stay flat until the end of the session).
Aggressive, Short-term, Intraday, or Professional Traders
Based on the market action so far, the intraday aggressive models are adjusting the original trailing stop to a simple stop at 2845, thus guaranteeing about 6-point profit if hit. IF this is hit and the long position gets closed for a 6-point profit, the models indicate adjusting the trading band for the rest of the session to 2855-2818 above which the models go long and below which the models will go short – both with a tight trailing stop of 5-points.
(NOTE: Trailing stops work differently from traidtional stop-orders. If you are not too sure, please click here to read on the conceptual workings of a trailing-stop)
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 and/or the trading plans mentioned are subject to change at any time, without any notice to anyone.