The market got absolutely slammed today. The S&P gapped down to about 1640, tried to mount a feeble bounce in the first 30 minutes and then spent the rest of the day grinding methodically lower, closing around 1630, down almost -1.60% The situation was even worse for the Russell, which sliced through its 50dma and closed down -2.40%.
The bad news for the bulls is that today’s action indicates there is likely additional downside ahead. The S&P has some support around 1620, but it could easily overshoot and test 1600. For the Russell, it looks like the next important area is 990-1000.
Having said that, after today’s shelacking the market is likely to attempt some sort of an oversold bounce tomorrow and we’ll have to wait and see how strong it will be.
It was a decent, yet somewhat disappointing day for me. I thought I stuck to my plan rather well. I was able to extract profits from TNA on the opening bounce, I found good relative strength momentum opportunities (EMMS, STXS, TSLA). In the afternoon when the market started rolling over, I managed to get more than +3% from UVXY.
However, I also had a big doozy in CPRX. It was acting strong off the open and I tried two trades only to get stopped out of both fairly quickly for sizable losses (first trade was -4.5%, second about -1.5%). I tried it one more time in the afternoon and got stopped out again. It took me most of the day to dig myself out of this hole and finish green.
In the relative sense, I have nothing to complain about. Posting a positive gain, even a small one, on the day when the market got massacred once again illustrates the value of my momentum trading strategy and my risk management in particular.
- Net Return: +0.56%
- 12 trades
- Win ratio: 50%
- Avg winner: +2.76%
- Avg loser: -1.51%
For more information on today’s trades, please click on the trading log below.