As pointed out in the month-end post for subscribers, the bulls are looking for a daily close above 2941 to open the door for a bigger move upward in the future. We started the first day of the month with a big push up on the “new NAFTA” trade agreement news, only to lose ground all day and never got above, let alone close above, the magic 2941 level. I’ll be watching this week for a daily close above this level to indicate more upside on the way. If you are looking for a short position, this could be a good place to take a bite at the apple. Why? Because if you took a position in the 2930’s, once price closed above 2941, you’d exit the position and chalk it up as a loss. Nice try. If it works out, you’re in GREAT position to ride that short for a decent gain if price continues to fall. Trading 101. Hope that helps someone out there. 🙂
UPDATE on 10/4/18: Well, if you took the short position, I hope you have booked some trading profits from the 40 plus point drop over the last few days. Depending upon the method, that is a nice “short term” profit. There is no guarantee we stay down near 2900 or below as we can still climb back above 2941 to get another leg higher going. Leaving a “runner” in place to capture the downside makes some sense, but that is Trading 201, not Trading 101. Hope some money was made by the subscribers.