I don't recommend any long positions until MFI gets oversold.
Looks to me like we broke the purple line and it's headed to the next green line. The ultimate bear scenario is that it breaks that line and resumes the original down channel.... but I'm not quite that bearish.
This is a bear market, you do not buy the dips. If you're doing bull trades in a bear market, your timing has to be near perfect. I'm not planning on going long, but if you are, at least wait until Monday. If anything, it takes more than a day to price in a rate hike. I'm talking about the July rate hike, possible .75.
Expect sector rotation tomorrow, probably a whipsaw day with a reversal pattern because of options expiration. Could be a bull trap though, I really don't recommend holding any long position over this weekend.
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BTW, my only recommended pre-Fed trade was doing a straddle, I said maybe GM.... which would have cost you $1.50. GM is down over $3 since is said that, so you could have doubled your money.
That is the safe way to play the Fed, I did not do it though, lol.
Market closed monday. Seems like peak fear and doom from my perspective. I'm adding shares and selling monthly CCs here until we see an uptrend form. Retail already panic sold, so I dont see what brings us down much more other than a black swan. we also have quad witch tomorrow, so im thinking gap up to 380 and fade / sideways to close around 375
hungry_hippo
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@MrMarketMaker, plenty of room to go down. Retail hasn't even hit pre-COVID levels, much less recession price, neither has NQ
MrMarketMaker
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@hungry_hippo, perhaps. The short trade seems crowded and you saw how much of a squeeze we had yesterday. 400 retest before 350 imho. GOOGL PE @ 19 is too attractive for me not to add LT here. Best of luck, I appreciate your charts very much!
hungry_hippo
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@MrMarketMaker, 5 year yield is now higher than the 2018 drop. Think about it.
Plus now, a lot of those "growth" companies aren't growing anymore like NFLX, ROKU, etc so they can't justify high PE ratios. We are headed lower, maybe not tomorrow, but definitely plenty of room