"Once I had a love and it was a gas
Soon turned out had a heart of glass
Seemed like the real thing, only to find
Mucho mistrust, love's gone behind" – Blondie
Wheeee, that was fun!
Especially if you took our advice and shorted the Nasdaq at 12,000 yesterday as we got a lovely 50-point drop twice, followed by a 100-point drop during the day and, eventually, we hit our target at 11,800 at 4am but we were happy to take 11,850 off the table before going to bed – still good for gains of $3,000 per contract – you're welcome!
I also said that, if the Nasdaq fails the 50-day moving average at 11,500, that we have no real support until the 200-day moving average at 10,250 – a 10% drop so let's hope I'm not on a hot streak for predictions coming true in a day. From 12,000 to 11,800 is a 200-point drop so we're looking for 40-point bounces to 11,840 (weak) and 11,880 (strong), which is where we are at 8am so we'll see if that can be beat at the open.
If not, the next lines to watch are the bounce lines off 11,500 and that's a 500-point drop so 100-point bounces to 11,600 (weak) and 11,700 (strong) and that is how we can plan out our Futures shorts – if 11,800 fails. Of course Congress is on vacation through Thanksgiving so there's no chance of a bailout this week or next and we're running out of Fed Speakers (see Monday's line-up) with Mester going right now (8:30) and Bowman at lunch and tomorrow it's Barkin, Bostic and Kaplan, all pre-market, but they've all already had at-bats this week and failed to deliver much encouragement.
- https://www.reuters.com/article/us-usa-fed-barkin/feds-barkin-lets-see-how-it-goes-on-whether-more-qe-needed-idUSKBN27Y2TD?il=0
- https://www.marketwatch.com/story/feds-bostic-says-softer-retail-sales-data-fits-the-picture-of-a-weaker-q4-11605623744
- “Right now, the trends are in the wrong direction,” Kaplan told a virtual event for the Louisiana communities of Shreveport and Bossier City.
Kind of the opposite of helpful, right?
So not much support going into the weekend and we'll continue to cash out positions over the next two days. This morning we'll take at our Money Talk Portfolio, which is easy to review since we can only change it on the show so no changes since October 6th (show aired on the 7th) other than VLO had been cashed in earier (June show) and we forgot to log it.
We're up about $12,500 (12.5%) since 10/6, so things are going well and I'll be on the show on the 9th next month, taping on the 8th so there are no changes to make today – just keeping tabs though, of course, I would be cashing out with a nice 39% gain on the year if the show were today because why risk the holidays?
We'll see if 11,880 (strong bounce) holds this morning but, if not, we can just use that for the shorting line on /NQ back to 11,800 for a $1,600 per contract gain and then, if the weak bounce fails at 11,840 – it's very likely that 11,800 will fail and then we're in for a very nice drop to at least 11,700 for $2,000 per contract. Watch AAPL, they are likely to test their own 50-day support at $115 and failing that would be devastating – for AAPL, the Nasdaq, the Dow and the S&P….
