c505218304b50c59c3659f6dda43bae7-links-0–> Last night was one of those historic stock market days – the Dow Futures were down 700+ points – and making headlines as the election vote was being counted and it became more and more clear that Trump would win.
You may recall I talked about last time that immediately after the circuit breakers kick in — is an excellent risk/reward opportunity to buy. Last time during Brexit, when it dropped to 1998 and the circuit breakers kicked in, there was a tradeable bounce all the way to 2060 — before the markets reversed back to new lows at 1980 for the actual bottom.
This time, circuit breakers kicked in at 2028.5 — and was there a tradeable bounce? Yea, not just 60 points like last time — but this time 130 points.
Last time, it turned back down after a 60 point rally, but this time, it does not appear that we will retest the lows as we went well beyond 60 points — more than doubling that amount.
And most of it happened between midnight and the market open. I’m pissed that I bought at 2029 and sold at 2060 for 30 points. Had I not put in that limit sell to go to bed, that would’ve been a solid 130 points. Of course, easier said than done to hold on that long, especially after what happened these past few months — when the exact opposite would happen.
At least now, we finally have something that appears to be trending without multiple fakeouts intraday.
In Monday’s post: Monday, 50 ES pt Clinton Gap Up Rally Post FBI Weekend News – I thought Clinton would win – and if so, then we would get to 2160ES.
“ then get we get the election results –and before we know it, ES will be at 2160+.”
Now we are at 2160ES — yet, it wasn’t Clinton who won, it was Trump.
So it’s almost like the market wants to go to 2160 — and if Clinton were to win, then there might be a rally and then pullback to 2160. But if Trump were to win, then market would collapse, only to recover and end up right back to where it belongs – 2160ES.
Compare this to what I suggested in yesterday’s post Monday, 50 ES pt Clinton Gap Up Rally Post FBI Weekend News – the possibility of multiple consecutive green candles, which could signify the beginning of the next rally.
Of course, the above chart isn’t that simple. There was a massive drop in the futures — but if we exclude the futures and only look at the cash index, it looks like it simply continued from where it left off.
Circuit breakers hit – and in chat, I mentioned that it’s “worth a buy” here at 2029 — for anyone who doesn’t sleep.
Turns out, that was the ultimate best buying opportunity. Too bad I sold at 2060 — of course after I sell, the market goes on to rally another 2160 — to reach the level I predicted in the prior blog post of 2160ES after the election. If only I held all the way — woud’ve been a 130 point trade. Boo. But hopefully anyone who saw it in chat at least scalped it for something — because this is exactly what happened last time with Brexit.
These circuit breakers offer the best opportunities — and almost always happen after midnight — when nobody is looking.
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