Session Recap 1/21
Folks-
Coming into the USA Cash session today, I was expecting market to show some strength if the 4436/4653 levels held overnight. I was looking for longs with this context at the open and was bullish when I saw accumulation on the tape at around 4430/4440. The move had some MAE due to stop runs, but eventually the tape did stabilize, making a run up to 4480 . Nasdaq NQ also gained about 300 points from the lows.
Here is a copy of my plan: Trade Plan
At 4480 , the tape started becoming soft again. This has been a pattern for last 2 days and S&P500 sold off in last couple hours, dropping below 4400, into 4380.
My plan yesterday called for more volatility and the fact that this is no place for extremely newbie traders- step aside, just observe and learn. Seasoned traders are doing ok in this volatility, they probably welcome it. However, this is no place for anyone who started within the last year or two.
Looking ahead- I do not expect this to change. The market may chop a bit more and may not find strength until the FOMC event on the 24th Wednesday.
Right now the technicals do not matter. The 200 MA does not matter. The falling wedge and rising bull flag does not matter- the market is searching for value, it is being driven by flows!
More on that later, with my thoughts and detailed playbook in my weekend posts. Stay tuned for that!
Personally, longer term for my own accounts, I did nibble at GOOG and AMZN today at 2850. In general, I am searching for deals here.. but I am not looking for deals in stocks that have already gone down 50, 60, 80% on the year.
I am looking for deals in industry leaders- the Facebooks, the GOOG and the Amazons of the world. My time frame on these names is basically “never sell”. They are industry leaders with pricing power, with majority of market cornered, with tremendous profits and sales which will not go down just because the bank now pays a half percent interest rate now than 0 earlier.
Again to reiterate for next week, I expect volatility. I also do think we are probably quite close to a meaningful (4250/4336) low when looked at from a lens of next 7-8 months in S&P500. The technical do look very scary right now, they are reminiscent of Feb/March 2020- however at least I do not see the same fundamentals at play here- at least not right now. I personally certainly think there is business to be done at 4680-4700 may be even a bit higher once the dust settles. Having said that, the general markets must show some evidence that the flows have changed. I do need some price confirmation to see that market is ready to move higher- which has been missing today as well as yesterday .
S&P500 closed the week at 4380. Much more to come in my Weekly Plan and Levels Stay tuned! Interim don’t make irrational mistakes. Step back and learn from all this volatility don’t let it go to waste.
Enjoy your weekend !
~ Tic
Disclaimer: This newsletter is not trading or investment advice, but for general informational purposes only. This newsletter represents my personal opinions which I am sharing publicly as my personal blog. Futures, stocks, bonds trading of any kind involves a lot of risk. No guarantee of any profit whatsoever is made. In fact, you may lose everything you have. So be very careful. I guarantee no profit whatsoever, You assume the entire cost and risk of any trading or investing activities you choose to undertake. You are solely responsible for making your own investment decisions. Owners/authors of this newsletter, its representatives, its principals, its moderators and its members, are NOT registered as securities broker-dealers or investment advisors either with the U.S. Securities and Exchange Commission, CFTC or with any other securities/regulatory authority. Consult with a registered investment advisor, broker-dealer, and/or financial advisor. Reading and using this newsletter or any of my publications, you are agreeing to these terms. Any screenshots used here are the courtesy of Ninja Trader, Think or Swim and/or Jigsaw. I am just an end user, they own all copyrights to their products.
I’m so glad you started this newsletter! You teased (threaten) for years to do so and now that you have it’s so much better than expected. Now I’ve got to go buy another gift subscription for someone.
Hi Tic, appreciate all your knowledge articles for newbies, but we need to make this better and real time for paid members. I have asked this before and asking again to create a private telegram channel for paid membership. The reason is simple, if all your alerts and cautions are on Twitter and Telegram with thousands of general public, what's different for paid members? Also, your plan a day ahead can change a lot once the cash session starts at 6:30am PT. The recap after the facts can be written both the ways no matter what happens to the market - and your warnings of market dropped 50 pts after my warning, I saw something on the tape, Oh 100 pt zipper on NQ after my alert and am the only bull at 4515, but when market drop to all-time lows, see my weekly bearish plan to prove you right all the time is considered more of a marketing strategy, which is fine. But you know no one can be right all the time. If someone could, they would never say so and eventually have more money than Musk, Bezos and Gates combined, right?
Let's get more practical in alerting in private channel during the market hours from 6:30am to 1pm PT, and you can issue live alerts during IB and after with your point of view on bullish or bearish at your order flow at certain levels real time (again not asking to share any individual trades) and at the end of market close, folks already know the % of success on your tape reading, you don't have to spend lot of time writing recap and looking for screenshots prove your directional story right in either direction - If you are up for challenge to prove your order flow directional bias right at least 80% of the time right with your real time alerts during the market hours and am ready to up my subscription fee by 2x for that service - sounds like a deal?