Early Morning Outlook

“That men do not learn very much from the lessons of history is the most important of all the lessons that history has to teach.” – Aldous Huxley
Just to put things in context, SPX off just over 5% from ATH. Not even a proper ‘correction’ yet.
As expected, the damage is appearing in Tech after we started to break with the first earnings gap downs a while ago but still, all things being equal, not that ugly. Blog readers are very familiar with all these breakdowns we have been reviewing for a long time: Netflix, FaceBook, Tencent, Alibaba and so on.
Remember that playing for markets to move in straight lines (on either side) is not a repeatable long-term way to build a solid track-record. Focus on the levels and structure. Especially when things start to move, it’s important to stick to basics and keep a very calm head.
All things being equal, one would expect to see some kind of sharp corrective rally at some point but that could be after an ugly open. In the current scenario, things should get worse before they get better and we’ll very likely be in ‘sell-rally’ mode unless something big hits the wires.
Keep in mind that expectation is for aggressive moves in either direction as the bigger patterns/move play out. As always, it’ll be imperative to stay nimble if trying to be aggressive on either side from here on.
In any case, this is where things get interesting / more strategic as experienced traders get really focused and have a real chance to deliver / perform. may it continue until year end.
If you are confused by the recent action, feel free to look back at some of the latest blog posts, along with the recent weekly outlook video and free access webinar session we posted that may help give you a better understanding of what is going on an how we see things playing out.
If you are interested in a more structured way of tackling the business of trading, attending a live daily morning call or a more detailed discussion on the charts we post / trade ideas, don’t hesitate to check out our Premium content.
Wishing you a great day ahead.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.