overall market outlook, gap analysis, trade expectations
The sellers were out in full force yesterday dropping their stock right down the elevator shaft, nearly 3%, in the major indices at the lows. Admittedly I tried to exercise some knife catching around 140.4 in the SPY as per my tweet yesterday late morning and I was naturally bulldozed over. But in this business, even the most aggressive (low probability) ideas are allowed so long as you manage the risk accordingly. I lost 30% more than my average losing day yesterday but thanks to [relatively]proper money management that is nothing of significance to the overall account. I cannot stress enough the importance of having a concrete plan when it comes to RISK. I am a discretionary trader in my approach to the markets, I do not have a red light, green light system, I do however have a RIGID approach when it comes to managing risk. You will not survive in this business without one.
But I digress. Coming into today I would anticipate we see some sideways 2 way digestion, possibly some type of drift directionally. I will be looking for trades both long and short, key is, know your levels and understand we probably won’t get a whole lot of commitment one way or the other. I will be mostly scalping today on the 5 minute, using relative weakness and strength to hit some quick singles.30-Minute key SPY levels
- $SPY support at 139.7. intraday support zone from yesterday and the close. under this we likely retest the low from yesterday at 139.06.
- $SPY resistance at 140.6. intraday retrace resistance and last weeks support pivot zone.
- $SPY resistance at 141. support becomes resistance, intermediate level of supply sitting there.
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