If you missed it, we sold five S&P500 e-minis at 2582 into the close. The Doji like daily candlesticks over the past few trading sessions was our sell signal. Note Doji’s have been the closest to ringing a bell at the short-term top in this correction. It’s worth a bet, in our book.
Moving Up Stop
They are ramping ’em in the overnight session and our position is now 13 points underwater. In haste, we put in a stop in at 2602 but now moving it up to 2604. Not a good habit to move stops when a position is moving against you but we will take a waiver on this one.
Note also the stop is pretty tight (less than 1 percent) for a 19 VIX.
Retail Traders And SPY
For those who don’t trade futures or have no account, a short can be executed in the S&P ETF, SPY.
Many like to play in the inverse S&P ETFs, and some even provide double and triple leverage – such as SDS, and SPXU. Only for professionals looking for a quick levered cash trade, in our opinion, and then tread carefully as these beasts behave squirrelly and should be used only for day trades.
If you didn’t get your short off at today’s close and the overnight gains hold, consider yourself lucky for a higher entry in the morning.
Stop on the SPY short is 260.25