Weekend Update: I’m short the US Market NOW

The above chart shows the SP Futures market is topping in what could be an “a” wave of a larger drawn-out B wave higher (purple), or could be all of the B wave (Black). Technically, we have all the waves in place to top NOW. Only the retrace will give us clues as to what we’re ultimately dealing with, but one thing I feel confident in is this particular advance is ending.

Friday towards the close I sold ES August EOM 4400 call options naked for the premium. This trade affords me the wiggle room of approximately 130 points and only gives the buyer of the options 18 days of life. These are the trades I enjoy the most to do on a Friday because even if the stock market opens higher Monday morning...it's possible these options have declined in value due to the premium destruction.

As we await more clues as to the ultimate direction of the US markets will take in the near term, I will remind my followers that eventually the lows will be tested way down in the 3600 level and a breach of that could take us to the 3200-3300 level rather quickly. However, we need to resolve if this B wave is ending or we’re just 1/3 of the way to topping.

Best to all,

Chris