3/7/22 Daily Analysis
Well that is definitely something you do not see everyday green or red… SPY hardly ever finishes =/- 2% let almost -2.91% ! WOW.
So that leads us the question we all need to ask ourselves… What Changed? What right now is different from last Wednesday when we saw a massively green day? What does this mean for the future? Here are a couple explanations I have:
– Market pricing in terrible CPI numbers coming out Thursday (leak or not)
– Now that feds are done tapering they aren’t gonna be able to prop (or want to) prop the market up anymore.
– More new media FUD related to Russia. Going into market open there was “cease fire” talks with Russia but quickly got squashed.
Overall regardless of the reason today was a day that I have never seen before trend wise. We saw for the first time in as long as I can remember (whether bull or bear) that the 8 EMA did NOT have a candle over the 8 ema to inverse the trend and cause a rest. Almost every single day no matter red or green we ALWAYS see a few candles thrown above or below the 8 ema in the opposite direction of the trend to rest indicators. Today though just absolutely flushed and the 8 EMA held resistance all day long. Havent seen anything like this in a long time. Another interesting thing is the candles never broke below the lower Bollinger… we almost always see some aggressive push above/ below the bollingers but we did not see that today.
Looking at the 15 minute chart we have a very important channel that we stayed in all day and are continuing in during after hours. I will be watching this closely to see If we break it or just continue another red day tomorrow.
Take a look at the FUTURES /ES chart… what do you see? You see a MAJOR channel that we just broke out of… we had been in this downward (slightly not aggressive) channel since March 2nd and we just dropped below it. That is not a good sign at all. That channel tried like hell to hold support earlier but it just could do it. Overall there are MANY MANY bearish signs right now.
You will note that the 15min RSI on SPY and /ES are both 24… We will see some sort of relief rally here either over night, pre market or early morning tomorrow. After hours right now we just hit a new LOD at 418.2.
Check out the daily chart for an even bigger picture of whats going on right now… Overall we are still within this grey channel and we just broke and closed below the mid half of it. That should cause a lower push towards roughly 390-400 depending on how fast/ slow we do it.
We closed a candle completely below the daily 8 EMA today too. 20EMA is still well below the 200EMA and the 50 EMA is still closing its gap on the 200EMA to form and official death cross.
I still do not recommend going long here holding over night BUT I feel we wil see 400 before we see 440 again. We have CPI data dropping Thursday morning and then FOMC next week. It will be interesting to see what those numbers are and how/ if that changes the expect 0.25bps rate hike that is expected.
Right now I am holding cash over night as iwe are still pretty easily skewed by new it appears. Favor to puts over bulls right now.
Imma hold off on support/ resistance numbers right now as we are all over the place and we need to see where this settles first. Will get some numbers out to you guys pre-market though when we have a better sense of direction!
Today was my first official day as a Full-Time Day Trader. Overall I think we had a pretty good day. Most of us were able to grab a quick 10-15% PUT early morning. Unfortunately some of us did get burnt around 11am when we were in puts and it went for a hot and fast 8 ema test. Many of us sold in the red only for the 8 ema to hold… I know I sold down -17% and if I held woulda been closer to -25% or -30% by time we got to the 8ema… Half the battle is mitigating losses so that you can recover from them easily. If I held to -30% to test the 8ema that we had at the time no reason to expect it to hold as mid day reversals are common thatd be a massive dip to recover from. I was about to get a 15% and 25% put later in the day before we got too over sold. Once we were below -2% there really was high risk to low reward. We had no idea or no way to expect this to end -2.91%… we should have expected this to recover to -1.5%.
Some day the best play is sitting on your hands. I know had I waited I wouldn’t have took my -17% loss. This is a wild market we are in right now. The name of the game is quick profits. Look for you setup and be patient. I promise you even on the worse day you will have a setup you can get your 10%. We aren’t getting rich over night we are getting rich over time.
Looking at the server poll looks like most of us got our 10% today which is good! Looking forward to tomorrow and getting our 10% again!
Submitted March 07, 2022 at 10:33PM by DaddyDersch
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