Hi Shoppers,
Wow, it’s pretty dicey out there.
The market has been very volatile for a while now and it picked up steam yesterday.
Look at these daily candles in SPDR S&P 500 (Ticker: SPY):
Those are some wide-ranging candles that show the big swings up and down.
Yesterday, SPY gapped up $2 on the opening, traded up $5 from there, and then right after 2 p.m. … nary an uptick on the five-minute chart:
SPY proceeded to trade down $14 from the day’s high.
Now that is a complete reversal!
These are the trading days, with the extreme moves one way and then the other, that it is easy to get chewed up.
It’s like whiplash.
And, yes, even I was a victim of the markets yesterday – you can practically see teeth marks!
I was long puts, spooked out of them on the upside and bailed too early.
It happens, especially on days like yesterday.
And I don’t see the markets slowing down from here, just yet.
All these wide-ranging days could be signaling the market is too toppy here.
Is $425 next stop on SPY?
We will see.
The key is to stay nimble and always be able to trade the next day.
Oiled Up
My last write up I talked about oil and I was looking for a pull back.
The charts looked so ready for it, check out the doji on Wednesday:
Oil futures and the oil stocks all looked like they were ready to trade lower yesterday – until they didn’t.
They made new highs, creating a bullish engulfing candle for most of the day.
What a difference an hour or so makes.
Now yesterday’s candle looks like a shooting star, indicating it could trade lower.
At this time, and after getting chewed up, I think I will wait and see what happens.
Thanks for Reading … See You Next Tuesday!
Licia Leslie