Equities have made an earnest effort to fill yesterday’s significant gap in trend-day fashion. However, I’m on the alert for potential support here near the respective five-day moving averages.
From last night’s ETF Rewind Newsletter Commentary in addition to the Excel file — well, sometimes we get it right….
Dear Subscriber,
We had a very nice start in equities for the New Year led by the Financials, and I was glad to see the Mrkt SPY systems catch the move. However, in-spite of the mid-day reversal, this leaves us officially overbought and I personally began to initiate short positions that I will leg into on any further momentum follow through higher. As bullish seasonality continues through tomorrow, that would hardly be a surprise, although I’d expect magnitude to be muted at best.
Note both the bearish reversion signal on the board tomorrow, as well as the Historic Volatility Rank, which at 1% should be screaming at us to minimally protect long positions. Indeed, the fact that the VIX actually closed higher is a sign that professional traders are doing so. Lastly, keep an eye out tomorrow for the release of the December FOMC meeting minutes.
Never Individual Investment Advice
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