FOR WEDNESDAY: (3/1) We’ve been tempted to publish our report after Trump’s speech but there will be the reaction and counter-reaction and the head-fake and the high-frequency trading and in the end we have to go with price and pattern and cycles and try to ignore the news. We got out of the way by taking profits in the morning on short dollars, long euros and long gold and short T-notes. Cycles for the speech are positive and that looks like it will carry into the morning so we should be ok being long stocks and long dollars if you want to speculate and there’s always another report or announcement to consider.
MARCH E-MINI S & P 500
SWING TRADING RECOMMENDATION: Hold March e-mini S & P longs from 2364.50 with a 2355.50 stop. Exit partials at 2374.75. If you exit ½ move stops up to 2359.50. Open to 2391 this week.
S&P ANALYSIS FOR WEDNESDAY: (3/1) Bought 1 contract Tuesday night. The lower target support at 2358 did hit today and we doubt that 2350 will come out and cycles suggest a positive reaction to the upside overnight. The path of least resistance is up. Support is at 2358.50 and resistance at 2373.50 and 2375.50. Eventually 2393 on cash and 2391 on futures needs to happen to have a major completion and that could happen by the end of the week. In any case, we still have a bias toward higher prices. Still, it usually doesn’t make sense to top-pick a bull. We will continue to look for patterns for a sense of completion by the end of the week toward 2393 on cash.
OVERALL: (2/15) We had an 80-100 point pullback in March into early April but will that be from 2393 on cash now? Not that far away now. Still thinking an early April low and then new highs this year still and not thinking crash this year and maybe a 10% correction between August-October and 20% of things seem more dire with US rioting and a deeper European collapse. Market seems lower from mid-May into late June and probably into July.
CYCLES OVERVIEW: Higher March 1; lower March 2; volatile/topping March 3.
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