Traders' A.I.

Model Biases/Outlook:

With the mixed action following the midterm results, our models have adopted a cautious, “indeterminate” stand while between 2795 and 2745. As of Wednesday 11/14, this is updated to a “mildly bearish” stand while below 2755, which would turn outright bearish with a daily close below 2685.

As we reiterated since the midterm elections last week, “this market is still likely going to be fraught with bull traps rather than bear traps – be cautious when buying into the spikes”. 

A Brief Trace Back of The Current Bias/Outlook

Thursday, 09/27, our models had negated the previously adopted bullish bias and signaled a neutral bias between 2933 and 2887, which was later updated to 2920 and 2880. 

On a break below 2880 on 10/10/18, our models executed the pre-published trading plan to book 142 points in profit on a short position! Our models have since adopted a “cautiously bearish” bias. This caution is in view of potential spikes up in a whipsaw mode.

As of the close on Wed, 10/24, our models turned bearish and continue to stay bearish while the index is below 2710. While within the 2710-2770 band, we reiterated an “indeterminate” bias for the market till 11/07.

As of the close on Wed, 11/07, our models negated the indeterminate bias and adopted a “cautiously bullish” bias. This is flipped back to “indeterminate” bias following the midterm election results action and will remain so while the index is between 2795 and 2745. 

As of Wed 11/14, we adopted a “mildly bearish” bias while below 2755. We reiterate this bias for the third consecutive day today, Fri 11/16.   

Trading Plans for FRI, 11/16:

Medium-term/long-term Investors

Following big wins during the volatile deep moves last few weeks, the medium-term models have sat out the markets most of the last week, waiting for the mid terms to be over. 

They are starting the post-mid-terms new trading week flat and have booked the following performance so far in the week: 

Mon 11/12: Booked 21.25 points in profit on a short.
Tue 11/13: Booked 10.50 points in profits on a short. 
Wed 11/14: Booked 15.50 points in profits on a short. 

The Outcome: The index opened below the 2706 level (2693.52) and only crossed it up during the session. The models stayed flat for the session with no trades for the day.   

Today’s Plan/Forecast: For today, Friday 11/16, our medium-term models indicate going long on a break above 2725, and indicate going short on a break below 2700 during the regular session – with a 10-point trailing stop. If the index does not cross these level during the regular session hours, the models would stay out of the market.   

Aggressive, Short-term, Intraday, or Professional Traders

The Outcome: The index opened below both the 2706 and 2695 levels (at 2693.52) and never crossed them from above during the session. However, the index crossed above the 2725 level around 2:15pm EST, triggering a long position with 8-point trailing stop. With the session high at 2735.38, the trailing stop was anchored at 2727.38, which was not triggered till the close. This was later triggered in the after hours, closing the position for a modest profit of 2.25 points.     

Today’s Plan/Forecast: For today, Friday 11/16, our aggre
ssive intraday models indicate going long on a break above 2725, and going short on a break below 2700 during the regular session – with a 8-point trailing stop.  

NOTE: Remember that a “trailing stop” works differently from the traditional stop-loss order. Please bear in mind that the trailing stop’s trigger level would keep changing throughout the session (click here to read on the conceptual workings of a trailing-stop). 

IMPORTANT RISK DISCLOSURES AND NOTICES – READ CAREFULLY: