Traders' A.I.

Model Biases/Outlook:

Considering that there are no major catalysts on the horizon (as of now) to keep driving the markets up to newer record highs or to push them down beyond the recent range lows, our models indicate a choppy, range-bound trading until the range is broken out of. 

Our medium-term models have negated the recent “slightly bullish” bias and are sporting a neutral bias since Thu, 09/27. No bearish bias in sight until all the way below 2887. On the up side, our medium-term models are looking for a daily close above 2933 to turn outright bullish again.

Aggressive, intraday models indicate the risk to the bears of a bullish spike for the day.  

A Brief Trace Back of The Current Bias/Outlook

On Friday, 09/07, our models had entered an “indeterminate” state and had negated their previous bullish bias, but had not adapted a bearish bias, yet. After reiterating this indeterminate bias for seven consecutive days, our models adopted a “slightly bullish” bias on Wed 09/19. 

For Mon, 09/24, we continued this bullish bias, with a cautious stand about the gap-up on Thu 09/20. On Monday this gap-fill was attempted by reaching within 0.13 points – our models wanted to see it filled fully and published caution to bulls until that is seen. On Wednesday, 09/26, this gap was filled and the market closed down. 

Thursday, 09/27, our models had negated the bullish bias and are adopting a neutral bias between 2917 and 2887. We reiterate this bias for today, Tue 10/02, for the fourth day in a row.   

Trading Plans for TUE, 10/02:

Medium-term/long-term Investors

The medium-term models have closed out the last position (a long) for a 12-point profit last week, opened at 2913 on Wed, 09/19 and have been flat since then (no positions). 

The medium-term models indicate trading off of a widened range of 2933 and 2887 – would go long on a daily close above 2933 and go short a daily close below 2887, both sides with a 10-point trailing stop.   

Aggressive, Short-term, Intraday, or Professional Traders

Our aggressive, intraday models’ trading plan for Monday, 10/01 – published before the markets opened on Monday – stated: “Models would go long on a break above 2921 during the regular session, or short on a break below 2915 during the regular session – with a 5-point trailing stop” (click here to verify this claim and read the full forecast).

S&P 500 Index opened Monday’s regular session 2926.29 – much above the 2921 level monitored by the models – and stayed above that level most of the session. After breaking below 2921, the index broke above it at 3:46pm EST, triggering a long position at 2921.50, with a 5-point trailing stop. At the high of 2925.24 – reached at 3:59pm – the trigger of the trailing stop is currently anchored at 2920.24 and will be so into the opening of the Tuesday’s regular session. 

For today’s  regular session, the aggressive intraday models indicate carrying the long position until its trailing stop is hit. If hit, the models would then trade off of 2932-2914 range – going long above 2932 and short below 2914, both with a 6-point trailing stop.  

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:

(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.

(vi) All opinions expressed herein are subject to change at any time, without any notice to anyone.