There's a lot of enthusiasm in the market right now. I think that could cause a pop up out of this cyan channel. However, there's still a lot of uncertainty within the new administration and weakness in the economy. If everything remains stable, I would expect and breakout to be faded back to the red line.
Basically, I'm shedding longs around 230 if possible and adding shorts from 230-235.
On the other hand, if Trump starts deporting 5% of the United States' population, I would expect a much larger pullback which could perhaps put us back into the longer term black line channel. I would consider buying on the bottom end of that.
On the whole, I think investing in the S&P right now is less intelligent than picking individual stocks. At least until the middle of next year.
Basically, I'm shedding longs around 230 if possible and adding shorts from 230-235.
On the other hand, if Trump starts deporting 5% of the United States' population, I would expect a much larger pullback which could perhaps put us back into the longer term black line channel. I would consider buying on the bottom end of that.
On the whole, I think investing in the S&P right now is less intelligent than picking individual stocks. At least until the middle of next year.
Comment:
230 was hit. Dow will continue to do much better than s&p for a while. Following the theoretical trade in 1/3 short at 230... 1/3 will be at 231.6 and 233.5. If s&p can't hit that within a month probably just going to scale in short as it goes down.