Results of Tuesday’s Best S&P Futures Turning Points: The short at 4498.00 stopped out. The breakout ran for 19.25 points.
Today’s Best S&P Futures Turning Points (consider wider stops and less size in fast moving markets):
Buy 4430.00 stop 4425.75. Short 4598.50 stop 4604.25.
The World Index: (+100/-100) soars from +7 to +64 with all major world markets solidly Bullish.
Catalysts: PPI, Retail Sales & Empire State MFG Index @ 8:30. Fed’s Barr @ 9:30. Crude Oil Inventories @ 10:30.
Quick Tip: Parabolic Moves
Yesterday was as fun as trading can be if you were long. Day, swing, or position trades all printed green.
For day trades you’re ready for a continuation or a reversal today. No worries. But for swing and position trades you have a tough decision to make.
The S&P is in a near parabolic move up. These simply don’t last forever, sometimes not for long at all. Yes, we’ve all heard the advice “Let your winners run” but for how far?
You should have some targets for exit or at least scaling out. You should adjust your stops to retain as much of the move as possible without exiting too quickly.
The important view to have is this: Taking profit after a parabolic move is good. This is not the time to relax and expect a similar continuation. Focus your plan on keeping as much of this move as possible. You can always get back in the trade after a correction if your intention was longer term.
P.S. Feel free to share this newsletter with your trading buddies.