Today is April Fool’s Day – and guess what – we got a market fake out with an opening drop towards 2035ES – and then a massive rally over 2060 and even new highs over 2064/2065.
In yesterday’s post Thursday, 3/31/16 End of Q1 2016 – S&P Trade on Track After Cashing Out $1,600, we thought the 4th wave was over and that we were beginning the 5th wave up.
Instead, yesterday was a B-wave high followed by our overnight C-wave low that went well below what I had initially expected in the 2045-2050 region — we went all the way down to 2035.
And what followed was a quick 5th wave up.
Indeed, this was a market fake out.
Even though we were “wrong” about the overnight action — our trade still expired for maximum profit today. This great when you are wrong and you can still make money. So on top of the $1,500 yesterday, we got another $400-$500 bucks cashed out today by doing nothing except letting the options that we shorted expire worthless. So even people who don’t follow the market (say you have a day job) would have just collected the money on this high probability bet — even with the market fakeout. That’s $2,000 for the week
Learn more about the Elliott Wave Complex Double Zig Zag here. I documented this pattern and some clues and rules regarding this pattern so that I can more easily spot it next time. I take note of areas of potential support – clues earlier in the pattern that tell us we are in a double zig zag, etc.
Trade of the week expired worthless for max profit today! Subscribe to follow along and access educational material related to the foundation of wave patterns, which I am continually adding to.
1) Entered on Tuesday March 29 (during Fed announcement).
2) Automatically exited (without having to do anything) on Friday, April 1 because the options expired worthless and we collected the money.