The July 9th Update suggested that a SPY 435.00 was a line in the sand between bearish (below) and neutral (above). The July 14th Update said essentially the same for Dow 35,000. Last Thursday's Update showed a market leading downtrend in the ARK Innovation Fund (ARKK) which had been leading the market up since April 2020. The most recent Weekend Update portrayed all of this "teetering on the edge," in graphical form. Today we have a confirmation of lower prices ahead. Although there is always a chance today's decline is a one-day wonder, the probabilities are now heavily weighted to the downside both short and intermediate term, maybe long term. September 17th at or out-of-the money index puts should thrive in this kind of downtrending market. As set out earlier today, VXX calls offer a higher risk higher reward trade on sharp rise in market volatility. No one strategy for trading this scenario fits every account, but we have put out enough bearish ideas to pick and choose an appropriate positioning for lower prices ahead: SPY, DIA, QQQ, IWM and ARKK puts, VXX calls. Finally, a week before 2nd qtr earnings are released, TSLA is down about $10. Tesla's news will only get better over the weeks and months ahead. Will it be enough to avert a loss commensurate with the general market? If TSLA follows the market down, the ARKK puts will act as a hedge, falling further and faster. ----------------------------------------- VXX Intermediate Term
