Two weeks ago I sent out, The Perfect Storm, suggesting that the equity markets were at a significant top. Today the Dow is down 569 points and the consensus of the "it only goes up" talking heads on CNBC is that it is, "...just a bad day." I agree that it was a bad day but there is no "just" about it. The same analyst who a month ago was pointing out that the market was making new highs in the face of increasing numbers of people coming down with the Delta variant, and how bullish that was, today was pointing out that the same Delta variant was decreasing, and how bullish that was. Delta variant up, bullish. Delta variant down, bullish. That why I eschew any kind of fundamental analysis of "The Big Picture," it's all rubbish.
There are now three red weekly candles (the third one in progress), for the first time since the Covid Crash 18 months ago, that's bearish, i.e., the probabilities continue to build momentum to the downside and that is tradable, eminently tradable. Only an up close for this week would temper my bearishness.
A Day In The Life Of An Option
Sep 18th - Single Day Performance:
VXX Oct 15th $27C = +110%
VXX Oct 15th $30C = +120%
QQQ Oct 15th $370P = +125%
DIA Oct 15th $345P = +105%
ROKU Oct 15th $300P = +70%
10 more weekly red candles before the end of the year, with one or two blue candles thrown in to keep things interesting.
QQQ target = <$300
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