This was the note I sent to my Family yesterday.
I was expecting a strong relief rally starting today following the not so good jobs report (a day that bad news is good news).
Well, the market indeed opened strongly and went up over 50 points for a good part of the day until later afternoon. Suddenly it went sour
by coming down in a hurry. I don't know what has caused this sudden turnaround but I guess maybe just the market is like a scared bird that
has been beaten up too much lately and it cannot hold up any good moves over the long weekend. It is really an unfortunate day, especially
for those who chased the market during the day.
Having said that, I don't think it is all that bearish. TA wise, actually it may be setting up even a strong base for the inevitable relief rally. After all,
it is nearly a perfect storm setup for such a rebound. Below is the hourly chart for SPX, which has shown a beautiful positive divergence even with
today's bad closing.
I was a bit aggressive in trading SPX/SPY for its rebound and took quite a few good profits during the day:
And I reopened a few long positions again for SPX for next week and two during the harsh selloff near the end of the day. I'm confident a strong rebound
will be coming again and probably soon!
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