There is always some exogenous excuse for a third wave down, so when you see the media hyping any iteration of, "trade wars market crash" this week, think, "third wave down," instead and turn panic into opportunity. Over the weekend I posted intermediate (daily) and short-term (30-minute) QQQ charts with five key price levels along with the following commentary: "Key levels surround the daily lows of last week: 521.19 (Fri) 518.21 (Thur) 516.90 (Wed) 511.78 (Tue) 510.15 (Mon). QQQ closed the week @ 522.29, just off its daily low, which is also the highest daily low of the week. I will monitoring closely in the days ahead and will be getting progressively bearish should these respective lows get taken out. The key low of the week, 510.15 has to hold, or its a third wave down, as shown on this chart, targeting 463, or worse." Today's opening gap down, a reflection of Sunday night panic trading, took out all but the lowest key level, which is one price level shy of confirming a third wave in progress. An hour into trading and the market is bouncing. How far and how high until this morning's lows are tested? Doesn't matter. What does is whether QQQ 510 holds or not. For now, we only care if it doesn't.* *Why we need price confirmation: Here are those weekend charts, updated through first hour of trading today: QQQ Daily Low today: 511.80 ; Low last week 510.15 Any print lower = add to bearish bets. QQQ 30 Minute SQQQ 30 One final quote from the Weekend Update: Best bet for downside leverage = SQQQ Feb 21st $30C Also attractive: Feb $31C & Feb $32C GLD: Buy Pending GLD pending Buy on a close > $260 If GLD breaks out, Wave 5 target is $325, taking highlighted calls up 10X. TSLA Now THAT looks more like a completed Wave (iv); File this under "Buy Pending."
