Tuesday, March 15, 2011

Worldwide selloff

11:12am: Today's system signal will be a "hold".  Anymore weakness this week, and we'll likely get another "buy" signal - in which case, I will double down on my long position.  I expect some strength in the next week or two with a return trip back up to the 50day MA around SPX 1300. 

10:35am: While the first hour trade was profitable, we didn't make a half gap fill.  This is probably a bad sign for the rest of the day. 

8:41am: With futures wayyy down, here are some things to consider.  Large gaps like what we're about to see will usually fill about halfway in the first hour.  For day traders, going long at the open and selling at 10:30ET is usually profitable.  If we don't fill at least half the gap by 1030, watch for the market to continue to sink all day.  If today turns into flash crash II, which I doubt, set buy orders at the 200 day MA, sit back for a few days as short covering rally ensues.  Good luck all.

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