Daily Plan 5/6 '22
Let the events of today be a reminder of how to think outside the box and take all so called “expert opinions” with a grain of salt.
AFAIK, I was one of the only handful of people who was a bear going into that close at 4300. See my plan from yesterday here: DAILY 5/5 '22
Folks were not only bullish spooz, but Nasdaq, ARKK, many other names which fell 8-10% today. Rough.
This morning in Chicago:
We opened below 4265
We could not even test 4265 in IB
We lost that key level in AAPL at 163 within the IB
A 200 point sell off from the close yesterday at 4300.
Further more , I was one of the very few people who called market may rally before the FOMC and could sell AFTER the FOMC. Both of these thesis turned out to be right. See my weekly post with these thesis: WEEKLY TIME FRAME THESIS
My plan yesterday also called pretty much the top ticks on many other names like AAPL, AMZN, GOOG etc
I want to start this post by addressing two common questions:
I mentioned in my weekend post (see this link) that if we close above 4200 on FOMC, I will be bullish then why was I bearish at 4300 yesterday close? Well, I have said this before and I will reiterate. The close above 4200 was not due to the flows. It was mainly due to the statement that Powell made which were misconstrued by the market to mean he was dovish. He was in-fact quite hawkish. The close above 4200 needs to be organic for me. Not without any word smithing by Powell and team.
Momentum: regular readers know I am a momentum trader. New folks may not. See this newsletter is sort of talks about several different time frames and I think to make sense of the levels when it comes to intraday action, I ask that any one new to this newsletter, please read and reread this post on momentum and it will help answer atleast some of the questions around levels and how I perceive momentum: TIC TOP.. I think any one following this along with the Market internals discussed here could have avoided a lot of pitfalls today as well as yesterday. Again, I ask you read both of these posts, especially if you operate intraday.
A couple more notes about my style..
As a new reader to my newsletter, expect my posts to make no sense in contrast to the popular sentient I do not consider any one’s opinions and all my levels and forecasts are independent research. So when 99% of folks are bullish, expect that I may very well be bearish and when every one is bearish, expect that I may be very bullish . I would not change my mind unless my methodology has indicated that I should.