The SPX advanced 0.51 point yesterday to close at 1089.19. TOT daily traders went 300% short at SPX 1098 early on Wednesday, another 100% short at SPX 1086 yesterday, and have held the position overnight and into today.
Since initiation of this service on September 30, 1993, our daily trader recommendations have gained 8337.82 cumulative SPX points compared to a gain of 630.26 points in the index itself over the same period.
The super long term perspective for the stock market remains bearish, and it’s unlikely anything will change that for several years.
Both the long term and short term models remain bearish.
I don’t recall ever seeing as neutral a day as we had yesterday. All five of the most closely watched indices – the Dow Industrials, the S&P 500, Russell 2000, the NASDAQ Composite, and the NASDAQ 100 all closed less than one tenth of one percent from unchanged. In addition, combined NYSE and NASDAQ advance/decline ratio was virtually even.
Today is options expiration, and while the impact of double witching has moved forward to earlier in the week in recent years, it still can be a significant factor in the market.
While the directional component of the daily model is bearish today, the risk component of the model is quite high. That’s not surprising in light of its being options expiration, but it is surprising in light of yesterday’s lack of volatility. TOT daily traders come into today’s session 400% short. Use a tight stop at SPX 1093 on half the position and a more distant stop at SPX 1106 on the other half. If not stopped out, carry your position over the weekend and into Monday.
Have a great weekend, thanks for the opportunity to be of service, and I’ll email you again in 72 hours – or sooner if circumstances warrant.
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