What a joke this market is becoming!
As you can see from Dave Fry's SPY chart, the S&P finished up 0.5% for the day after an amazing 10-point rally that began the second the European markets closed (11:30). It was incredible – as in NOT in the least bit credible but, as we knew, it would be enough to make Europe regret yesterday's 2% sell-off and then Europe would bounce this morning (up over 2%) and that would then boost our Futures (now up 0.66%). This BS was so obvious that we closed our day in the Live Chat Room with this trade idea for our Members:
This will be interesting as Europe finished down 2%(ish) and now we're back flat. Presumably, they'll try to catch up tomorrow (and NKD has reset to 18,800) so I think I like TF long here (1,107) as a fun play on the assumption that Asia and Europe will pop the futures.
Down from 1,200 to 1,100 you'd expect a 10-point bounce anyway so I think it's worth a small gamble.
As you cans see we popped to 1,115 for an $800 per contract gain but now we're flipping short because, as noted, yesterday's rally was complete BS – which is obvious if you look at the internals:
This is why charts don't give you the real story! 2,339 declines vs 834 advance with 632 new 52-week lows and we finish up 0.5%? That's incredible – NOT credible. Still, there was the good old support line at 2,000 so of course bouncy. 2,100 to 2,000 means 2,020 is weak and 2,040 is strong but when you get an air bounce off 2,000 (never quite hit it outside of a brief spike), then minimum expectation is…