Bulls, Bears, and Pigs – Finale?
For the 7th day since our first published trading plan with the theme of “Bulls, Bears, and Pigs”, we reiterated our caution to the bulls in our last published trading plans on Wed, 08/17. We wrote: “Despite the surge up since that day, if you have been playing on the long side, it might be prudent to take some money off the table. Bears might want to start nibbling a bit again, but need to wait for a daily close below 4255 to start chomping”.
Those downside levels have come to fruition, finally, and our positional model’s short that was carried through patiently, is now on track to hit the profit target. We might take our bearish bets off the table and wait for another trade, depending on the price action to unfold today,
Positional Trading Models: Our positional trading models went short on Thu. 08/11, on a break below 4205 with an entry of 4203.30 and a 4166 take-profit target and no trailing stop. Our last published trading plan stated: “We carried this short through the spike up since then, and our models indicate to carry it until otherwise specified or until the profit target is hit”. Based on the price action in the overnight futures, our price target now appears within reach in today’s session. Models indicate exiting the short on a crossing above of 4170, 4185, 4196. If exited the short, positional models will stay out of the market for the rest of the day.
Intraday/Aggressive Models: Our aggressive, intraday models indicate the trading plans below for today.
Trading Plans for MON 08/22:
Aggressive Intraday Models: For today, our aggressive intraday models indicate going long on a break above 4222, 4203, or 4165 with a 9-point trailing stop, and going short on a break below 4200, 4190, or 4218 with a 9-point trailing stop.
Models indicate long exits on a break below 4234, and short exits on a break above 4179. Models also indicate a break-even hard stop once a trade gets into a 4-point profit level. Models indicate taking these signals from 09:31 am ET or later.
By definition the intraday models do not hold any positions overnight – the models exit any open position at the close of the last bar (3:59pm bar or 4:00pm bar, depending on your platform’s bar timing convention).
To avoid getting whipsawed, use at least a 5-minute closing or a higher time frame (a 1-minute if you know what you are doing) – 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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