Long

S&P 5,000,000

Updated

The talk of the town is the Market is overdue for a plummet!
Fun fact: This has been the narrative for the last decade as far as I am aware.
It's more likely that the major indicies will continue grinding up or even go sideways a bit.

This chart certainly appears to signal "euphoria". It looks overextended, parabolic, intimidating, right?

Now if we press the reality button labeled "log" it will adjust the chart based on percentage change. Then like magic, we can adjust the visual scale and BOOM, it's all gone. Of course the ideal chart to use lies somewhere in the middle. But when looking at a long term chart with large numbers, always use log scale. (Try it on Bitcoin)

What are we even worried about?
Suppose we do get a sell off. Let's measure out the damage from the Global Financial Crisis. We find more number magic with the percentage gains going up are far greater than while going down.

What about the looming Solvency Crisis?
"What if's" are not going to make anyone money unless you're the one selling click bait articles. But there is a way to trade this and still feel safe. Here are the conditions...

Put on a 1 Hour chart, buy dips, sell rallies. Each short term rally is about $50-$100 on the S&P500 and the benefit of short term trades under the conditions below helps steer clear of "crisis" danger.
1. (Daily) MACD is above zero
2. (Daily) EMA is acting as support
3. (1 Hour) RSI dips to bottom channel

There you have it. Feel free to stay on the sidelines with Peter Schiff and Steve Van Metere but this is my strategy for trading micro ES futures up until September 2021.
Will post active trades below.

Trading is risky. Don't do it.

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Small adjustment***** I set my RSI indicator at 10 instead of the default 14.

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Nice sell off today. The main risk here is if we get a DXY bounce which would translate to a larger liquidation. Waiting for a supportive candle is crucial for day/swing trading. For long term holds on equities, my position size is 30% currently. The bigger the dips, the more I accumulate.

Trade active

Bought this dip at 3666 as 666 tends to be a support/resistance level.
Fun Fact: The SPX bottomed at 666 in the Global Financial Crisis.... maybe someone placed their buy orders there.

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Supportive hammer formed on the 1 hour and RSI is oversold.

Trade closed: stop reached

Set my stop loss in profit and it hit this morning for a small gain.
-1 @ 3685

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Bought it back @ 3708
Very strong break back above 3700 and RSI has plenty of room to run.

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Recap: I sold the first trade because price action starting rolling over below the 3700 resistance level. But upon breaking through, I re-entered and targeted 3750 where the uptrend last held up.

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I've placed a buy stop order at 3805 to take advantage of a potential break towards 4000.
1. There seems to be a bullish flag forming near the top of this channel
2. Extrapolating the 'flag pole' puts a target right up near 4000
3. RSI and MACD on the 1hr are both bullish

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Order filled.
+1 @ 3805

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Holding and will probably buy more next week at the bottom of the main channel.

Trade closed: target reached

-1 @ 3849

Prices initially broke out but failed to hold and retreated to the bottom of the channel. Only to pop back up and retest the previous resistance before rallying. That is where I should have bought more but I missed it. Currently, the RSI is over extended and we are near the top of the channel so I closed this trade for a nice gain.

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I believe 4000 is imminent. Looking for a break above the previous high and potentially take advantage of a small squeeze up to the previous top of the trend line.

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Going to be cautious here and not buy this dip since treasury yields are potentially rolling over into a new down trend. This can sometimes tip markets over.

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Previous high failed to break through and instead, it popped out of the channel and a small plummet ensued. Looking for a bounce at that trend line I had drawn out a while back, which coincides with the 50 Day EMA around 3700.

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Slept in and missed this move. Need to see price pop back into the upward channel before the next buy. This could be a retest of the break down so it's better to be cautious.

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Nice correction in the indicies and soon to be a buying opportunity. As price continued to rise, the daily RSI diverged lower and now that price broke down, it is close to being oversold. Volume tends to come in on 666 marks so I am looking for support there. If that holds, it will likely break out of this new down trend and recapture the previous levels. Best to wait until Monday.

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As price tags 3666 on Sunday, it's possible it could bounce here. However, it is important to wait for confirmation. This move might set off a wave of algo selling this week. If this happens I'll be watching some likely targets and levels where high volume came in previously.

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Well there you have it. I was leaning more (hoping) towards that sell off scenario but once again, long the S&P seems to be the reliable trade these days. It had a strong recovery mainly because it's largely composed of tech stocks that beat earnings expectations. Now price is back in the channel so it might make more sense to just disregard this deviation and play it off the channel bottom. I'd like to wait to see where price is when the RSI eventually comes back down. From there I can make the next long trade.

Trade active

Buying the breakout at 3916. Hopefully not another false break. To me it looks like a bull flag and the extrapolation targets 4000 next week.

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Tech stocks are dragging on the S&P for now. Last time I checked hedge funds were net short the Nasdaq. If price can break out and back test the channel I'll add. It looks like a similar setup from mid January. Breaking below, however, could trigger steeper sell off.

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As of now, the 10 yr yield is still moving higher. The recent CoT report indicates that Asset Managers and Hedge Funds have heavily reduced shorts and increased longs on the Financial sector. Hedge Funds were net short Nasdaq(tech). So the S&P is being dragged down and pulled up at the same time. Soon as tech becomes oversold and starts to move up, the S&P will melt up into the 4000 target.

Trade closed: stop reached

Stopped out. Don't want to f*ck with the 10yr.

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High volume points to what levels to watch for next support. Waiting for a break of the downtrend line with a bullish daily close otherwise staying on the sidelines. Interest rates rising as they are can be devastating with the amount of debt in the system. Devastating with a capital D ###The 10 Yr Bond yield.

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Bought too early yesterday, got stopped out today, then bought back today as I think it will retest 3900 if not break higher. Tech stocks are dragging it lower and they look oversold in the short term.

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3900 target reached but I'm going to hold for now.

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Seems only a matter of time before wall street takes this to 4000+

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Ok, closing here on the failed break of 3900 in profit.

Trade active

Every other day there is a new call for a big financial crisis liquidity crunch sell off. Long @ 3939 today... We're breaking 4k this week.

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4k broken. Waiting for a melt up sometime over the next few weeks.

Trade closed: target reached

Melt up right out the gate and now seeing a slight momentum divergence on the MACD. Time for me to exit with a decent profit and wait for re-entry.

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Stage is set to ride a wave to the next target. Waiting for pullback or consolidation/break higher.

Trade active

Looks a bit overkill. Buying MES +1 @ 4,133

Trade closed: target reached

Sold -1 @ 4,159 for a quick $130 gain. The technicals don't look right for a hold just yet...

Trade active

Buying here. Price is now in support range and should be setting up for the next wave towards my destination target 4,666

Trade closed: target reached

Target hit and now I'd rather wait for a larger pull back to get a better value

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It appears the new channel is established so that's where the high probability trades are. Tesla among others will pull back at some point and drag on things a bit. Could look something like this

trade-God

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