S&P 500 INDEX MODEL TRADING PLANS for MON. 01/22
The follow through to the new record high in the index is to be closely watched for clues on how robust this new leg up could turn out to be. On the other hand, earnings appear to start bringing valuation concerns into the focus of investors. The earnings announcements this week and next could show if the inflation is eating into corporate earnings.
Nevertheless, there is no indication of meaningful weakness showing up on the markets, yet. As we have been cautioning for some time now, if you are itching to go short this market, you need to wait for a confirmation rather than jumping the gun. 4815 is the immediate support level, and 4924 is the next major resistance level to watch for.
Aggressive, Intraday Trading Plans:
For today, our aggressive intraday models indicate going long on a break above 4868, 4843, 4819, or 4802 with a 9-point trailing stop, and going short on a break below 4857, 4840, 4827, 4817, or 4797 with a 9-point trailing stop.
Models indicate explicit long exits on a break below 4865 or 4848, and explicit short exits on a break above 4860 or 4831. Once a position is in a 4-point profit, models indicate placing a break-even stop to trigger on a break below the entry level. Models indicate taking these signals from 11:31am EST.
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.
NOTES – HOW TO INTERPRET/USE THESE TRADING PLANS:
(i) The trading levels identified are derived from our A.I. Powered Quant Models. Depending on the market conditions, these may or may not correspond to any specific indicator(s).
(ii) These trading plans may be used to trade in any instrument that tracks the S&P 500 Index (e.g., ETFs such as SPY, derivatives such as futures and options on futures, and SPX options), triggered by the price levels in the Index. The results of these indicated trades would vary widely depending on the timeframe you use (tick chart, 1 minute, or 5 minute, or 15 minute or 60 minute etc.), the quality of your broker’s execution, any slippages, your trading commissions and many other factors.
(iii) For the execution of our models trading plans, a “break above/below” is deemed to have occurred when the index closes above/below (if you are trading by bar close) a specified trading level.
(iv) For the trades to trigger, the breaks should occur during the regular session hours starting at 9:30am ET. By design, they carry only one open position at any given time.
(v) Once a position is opened, the corresponding break level (long or short) becomes the break-even hard stop (if-touched) once the position goes into profit by the break-even number of points.
(vi) These are NOT trading recommendations for any individual(s) and may or may not be suitable to your own financial objectives and risk tolerance – USE these ONLY as educational tools to inform and educate your own trading decisions, at your own risk.
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