Friday's shot across the bow was a wake-up call for developing a strategy for a black swan event that threatens the market. For us, it is one of the rare times this year when we had little in the way of bearish bets on market indices. Accordingly, having looked at all of the usual suspects I found the IWM chart that appeared ripe for a tradable downturn. The low print after the gap-down opening on Friday was 209.05, which served as our trigger for entering July puts if it was violated violated to the downside. That happened in the final hour of trading, so we are long July IWM puts as per Into The Close (Fri). IWM Daily A concurrence of Wave counts, a peek at Elliott Wave International's take on Russell: "The implication of which is that prices will now decline in a fairly persistent manner in the coming weeks." - EWI International The IWM chart was used to trigger our entry in the heat of action on Friday. Today, Saturday Jun 14th, I found another chart ripe for a trigger in the QQQ 3Hr (180 Minute). The chart below sets out a trading system in and of itself, using our Volatility Breakout System for entries. The technique is simple and ideally suited for Intermediate Term directional trading. I've embedded the entries on the chart below, both for the downtrends starting in February and June and the uptrend that ran from April through Friday's breakdown. Initial target is forecasted around 400 initially and then eventually reaching down into the low 300's. Risk 50% to make a Godzillion percent...but wait until after Monday's Open, which as of this writing (Saturday AM Arizona time) is yet to be determined. Any "bang the table" trades will be posted to the PRO and Premium services after the Open. QQQ - Godzillion Percent, Pending QQQ - Attractive Puts: July 18th 510-500 LONGS On the Long side, although TSLA (via TSLL calls) hit 50% trailing stops, if the market doesn't crash Monday, consider adding back any Sep $15C if previously exited. In all the mayhem of Friday, TSLA was up 2.00%, while TSLL was up close to 4.00%. TSLA TSLL Sep $15C NEM - New Long Newmont Mining triggered on Friday as per the In The Close (Thur). NEM NEM Sep $60C BONDS & INTEREST RATES TLT: Updated Strategy Buy first tranche of puts < $85.50; second below $84.00 TLT Sep $85P TNX - 10 Year Yield Higher yields ---> TLT lower prices BOTTOM LINE FOR MONDAY Monday morning's stock market Open is a wild card, anywhere from hard down to substantial recovery of Friday's losses. Whatever the trading looks like I expect be either adding to Shorts (QQQ & IWM July puts) or adding to Longs (TSLL calls), depending on market mood when the Opens' dust settles. Active Options PRO Service Premium Service
