Index Sell Signals Friday's price action, especially during the last hour of the trading session, has resulted in QQQ, IWM, EEM and SPY all generating Sell Signals on their respective 180 minute (3 hour) trend models. DJIA also generated a Sell on its Daily trend model. It is hard to ignore this consensus of bearish price patterns and across all market indices. Some puts (and/or VXX calls) are in order. The trades below are not exclusive, any index puts will do, any 2021 expiration, and any strike. Updating the charts from Friday's Alert, Three Trades Pending: DJIA/DIA Intermediate Term Sell Signal: DJIA/DIA Option: DIA Oct 15th $345P (6.00-6.30) Stop: 50% (3.00-3.15: subject to price fill) The DIA chart below sets out a worst case scenario that assumes the Aug 16th high was a major turning point that will lead the market much lower over the next six weeks. The DIA (or any other index) is a bet on that unfolding, starting now. The market will confirm or call into question that assumption next week. ROKU Intermediate Term Sell Signal: ROKU Option: Oct 15th $300P (7.95-8.30) Stop 50% (4.00-4.15) VXX The shorter-term PRO Service is already Long VXX Sep 17th $25C via a Buy Signal on the VXX hourly trend model on Tuesday. The 180 minute trend model followed through with its own Buy on Friday. If a Daily Buy Signal is generated this week, expect that this VXX trade can be one of our best of the year. A more cautious approach would await the Daily Model to follow-through with its own signal before jumping in. Short-to-Intermediate Term Buy Signal: VXX Option: Oct 15th $30C (2.50) Stop: None Bitcoin
