Wheeeee, what a ride!
That $6,205 profit is just what we made playing the bounce overnight on the Russell as I said to our Members at 10:54pm (yes, we work all night!):
I take it back, picked up 2 long /TF for fun (1,429).
/YM also tempting above the 23,400 line with tight stops below. Getting back the 1,000-point drop would be $5,000 per contract!
The Dow (/YM) Futures also did well, topping out all the way back at 24,100 with a stop-out at 24,000 for a gain of $3,500 per contract. Again, this is why we love trading the Futures – this is just our overnight money but it also serves to lock in the gains we made on our hedges and now (6:30 am) we're looking to play for a bounce off 2,600 on /ES, 6,400 on /NQ, 1,450 on /TF and 23,750 on /YM but, if they break down, we'll use the 2,600 line on the S&P for shorting so, either way – we are able to make fine adjustments to our portfolios on the fly.
Now that we're down 10%, we'll see how 2,550 holds up on the S&P (/ES) but we should get a nice 2% move higher as simply a weak bounce from here so we're targeting 2,600 as a weak bounce and 2,650 as a strong bounce and anything less than that is going to be a sign of further weakness. We already tested 2,650 at 4am and failed and, as I noted above, we're ready to short at the weak bounce line if it fails or go long if it holds. Though it was ugly, the sell-off was not unexpected – as I said to our Members: