Bulls Settled In Full Force, Driving the Bears Into Hiding!
On Friday, the S&P 500 Index broke out of the 2735-45 range that we referred to in the forecasts all last week, and triggered long (bought) positions by both our Medium-term and Intraday/Aggressive models, as alerted to in our Intraday Alert published on Friday after noon (click here for the full report). This action confirms the strengh of the bulls in the current market and the weakened bear.
Model Biases/Outlook:
After 14 consecutive days of bearish bias, our models have negated the bearish bias on Friday!
As forecast for Monday (click here for the forecast published Sunday night), the S&P 500 Index continued the move up to test the mentioned 2775-85 region, and actually closed at 2784.17 – within one point from the upper bound the models indicated!
For Tuesday, the index is likely to test the strong resistance band of 2795-2805, which could prove tough to break out of. If broken above, then models indicate the March high of 2872.87 in play again. If failed to break above, 2780-2770 to act as a strong support below.
Trading Plans for TUE 07/10/2018:
Medium-term/long-term Investors
The medium-term models are now long – bought at the index level of 2752.50 on Friday. As per the Intraday Alerts issued Monday (click here for alert1, and click here for alert2) the long positions survived the profit-taking trailing stops and the position now has a 12-point trailing stop (trigger level set to 2772.17 as of the close of the regular session). This trailing stop would be locking in a profit of about 20 points on the position, if hit!
If the stop is hit, stay flat between 2770 and 2810. Meidum-term models indicate no bearish bias until below 2760.
Aggressive, Short-term, Intraday, or Professional Traders
The short-term/Intraday/Agressive models are currently long – bought at the index level of 2745.50 on Friday. As per the Intraday Alerts issued Monday (click here for alert1, and click here for alert2) the long positions survived the profit-taking trailing stops and the position now has a 12-point trailing stop (trigger level set to 2772.17 as of the close of the regular session). This trailing stop would be locking in a profit of about 27 points on the position, if hit!
If you are not sure about or just want a refresher on how a “Trailing Stop” works, please click on this educational article to learn more.
IMPORTANT NOTICES & DISCLAIMERS – 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.