I’m 95% cash for the weekend, and expect to get short on Tuesday.  This is assuming, of course, that hurricane Katia (I pronounce it kuh-TEE-uh) doesn’t wash over Central Florida and knock out my power.  It was almost funny to hear the Northerners complain about losing power for a few days in the summertime.  They were whining like nobody had called in extra support from Colorado to help restore services or anything.

But I digress.

First chart: S&P 500 e-mini futures daily.  Friday closed back down to the lowest Fibonacci retracement above the bottom.  21-MA is getting flat, however, and I see possible support from the rising channel within the bounce.  We should have at least one more day of downside, and my target here is 1140.

When I trade, I plan on buying calls or puts on FAZ or TZA as I watch XLF and $RUT (Russell 2000), respectively.  XLF daily chart below shows me no reason to go up before coming down some more, so I anticipate more shorting opportunities on Tuesday.  There’s good support at 12.31, but why don’t we go ahead and just head back down to 12.00 and get it over with?

Here’s XLF 30-min chart.  I drew Fibo lines from the last rally, and we’re moving nicely within the price levels, from 50% down to 38.2%.  Notice the double support at the 23.6% retrace, 12.31.  I’ll upload the charts to MyCharts.

    You are unauthorized to view this page.

You Might Like

  • Learn to trade within your means.

    Stop Trying to Hit Home Runs: Start Trading Within Your Means

  • Avoiding traps on stock breakout plays.

    How to Trade Breakouts Without Getting Trapped

  • how to manage your swing trades when it comes to headline risk.

    Managing Headline Risk: How to Survive the News Cycle Without Losing Your Mind