The trend has been broken. Whether you’re a fundamental or a technical trader (or a bit of both, which you should be), a clear trend has been broken to the downside. The trend actually got cracked to the downside on Friday the 4th, the following day after $SPY began selling off on the 3rd. Last week, solidified the move, as the markets just couldn’t rally back; despite its numerous attempts to trap bulls throughout the week.
Now, we’re not saying the backside is in and it’ll be a free-fall for months to come – slow down there. What we are saying, is a key technical level has been breached to the downside and this will naturally provide fuel for perma-bears to lean on their positions. Like everything else in the markets; when selling begins, panic also begins – and this nasty reality has a domino effect. The move may not be justified, but that doesn’t matter; remember it’s the perception of value, not the actual value itself.
Of course, this brief breech to the downside may just be that, brief. We are all well aware of the orchestrated moves the Street lays onto unsuspecting market participants.So, the jump-off selloff from the 3rd, could just be a “dip” – highly unlikely; although the bulls would like to believe that and are defending their positions as deep as their pockets will allow.
Is that Mr. Margin calling?
We are just 50-days away from the U.S. election, but the “Donald” has plenty of time to shake the market up. We all know how he likes to brag about how high the market is. Don’t worry, he’s definitely plotting his move; it’s all about timing.
Whatever happens this week, don’t fight the trend and avoid the obvious traps (morning reversals); there will be plenty.
With that said, as always, keep it simple; if this, then that.
Remember, it’s chess, not checkers – be patient and trade only clean charts with crystal-clean A+ set-ups.
***This is our Sunday scan for the week, so we may be adding/editing the list during tomorrow’s PM session.
We’re kicking off this week’s session, looking at securities in the following sectors: Consumer Discretionary, Consumer Staples, Industrials, Health Care, Materials, Technology.
$BIGC, $BNTX, $CHWY, $DPHC, $GSX, $JD, $LYB, $OSTK
Keep an eye out for our daily Trade Ideas throughout the week, where we post the stocks we’re looking at for the day’s session.
Members will be getting a video breakdown of our entries and exits in securities on both the Watch List and additional Trade Ideas.
As always, remain patient; all you need is one. Manage your risk properly and cut your losses quickly.
If you would like to know more about how we trade the market here at The Street Trading, reach out to us and we’ll get you started.