Previously we said bears had significant risk of a parabolic rally if previous low held but if they broke sellers would likely be strong. We proposed if willing to accept the face rip risk and general risks of aggressive bets yesterday was optimal time to position with OTM puts. The double bottom has failed in SPX and is being tested now in Nasdaq.
We said a low break was at least a 4200 target. We’re not too far from there now. Break evens should be locked in from any entries high in previous rally. If we get more something outside of the expected move we could see any kind of messy action in a longer range even if the drop is overall correct. We need trending action here.
4180 is where we have major bounce or much more significant break.
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