I rushed to get the 12:22 update to you in time to act, but I want to share my reasoning with you.
All five of the biggest stocks on NASDAQ — Apple, Microsoft, Amazon, Facebook, and Alphabet (Google) are ALL down by more than 1% with the first two of them down by more than 2%. This is quite bearish on a day when the general market is up.
TOT daily traders came into today’s session 300% long from an average price of SPX 2432.09. The sell stop on the position at SPX 2440 was elected at 12:26, and the market has been slipping since then. Preliminarily, the daily model will be bearish on Monday, and the combination of the two preceding items made me want to exit quickly. We are currently flat, and that is where I want to be, although with hindsight, I may regret not going short today, in anticipation of Monday. On the other hand (there always is one, isn’t there!), the selloff in the general market may have partially been a function of Nancy Pelosi’s publicly questioning President Trump’s “fitness for office,” something that to the best of my historical memory, has never been done before in the US by the leader of the opposition party. Its significance, if there is no follow-up, may be small unless the president tweets something stupid in response.
Have a great weekend, thanks for the opportunity to be of service, and I’ll email you again before the start of Monday’s trading session.
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