Tumblin’ Tuesday (Again) – Markets Turn Ugly, Dow 25,000 Fails
Wheeeee!!!!
As you know, we love a good sell-off because we're very well-hedged but now we seem to be breaking even lower and we'll have to look at improving our hedges – just in case. We are significantly lower than 10/9's Tumblin' Tuesday and 10/2 was "Tuesday – Trouble at 1,700 for the Russell" and we're miles from that now as we are almost down to 1,500 and Sept 25th our Morning Report was: "Toppy Tuesday – Markets Bounce Back Ahead of the Fed" after 9/18's "Tariffic Tuesday – Markets Ignore Another $200Bn Drag on Global Trade". Oh, and last Tuesday was: "Tempting Tuesday – Nothing has Changed but Markets Move Higher."
I don't do these reviews to say "I told you so" – it's my job to tell you so! Reviews are important because next time we're in a similar situation, you may recognize that that's what happened last time and that will help you make better trading decisions. That's why I started keeping a blog in the first place – to review my own thought process as I traded! Like last week, when I warned about chasing weak bounces, which we were clearly having that day. On that Monday (15th) we had posted the bounce lines for the indexes, according to our Fabulous 5% Rule:
- Dow (/YM): 25,450 (weak) and 25,700 (strong) – now 25,317
- S&P (/ES): 2,775 (weak) and 2,800 (strong) – now 2,766
- Nasdaq (/NQ): 7,100 (weak) and 7,250 (strong) – now 7,157
- Apple (AAPL): $223.50 (weak) and $226 (strong) – now $222
- Russell (/RTY): Anything below 1,552 is catastrophic – now 1,545