After getting schmoked in some premature S&P shorts last week, we stated in our Week In Review over the weekend,

We expect the S&P to take out the recent high at 2675.47 and then set its sight on 2710-2720, which is the zip code of a yuuuge Fibo level and the 100-day moving average.  Probably the place to sell but will revisit when we get there.  – GMM, 

Today’s high on the S&P was 2708.95 and it’s getting real close to start thinking about posting the “For Sale” sign.  Our initial thoughts are to give the market a little more running room and to sell the “China deal is the greatest deal ever” news hype.

NFW does China do the deal Trump wants.  The president “comprehensive” deal in his informal presser this morning.  Comprehensive will not include structural reforms.

Brazil Country ETF

By the way, we wrote on New Year’s Day,

The animal spirits of a new market-friendly government should boost the BOVESPA during the administration’s honeymoon.  Brazil is our favorite stock market to start the year.

Probably the best way to play it is with the Country ETF,  EWZ, with the buy trigger at break above the 50-day at $38.99, in our opinion.   First upside target is $47.77.  After the purchase, put in the first trailing stop at $36.20.

EWZ has been correcting after the almost 40 percent six-week runup into the election. The ETF could see a measured move to $47.77-$53.38 in a timeframe dependent on how global markets fare in January.   Good risk reward with a potential 20-35 percent upside.  Not a bad day at the office.   – GMM, January 1, 2019

The Brazil Country ETF is up almost 20 percent YTD.

One of our readers, who made a whole lot of money in this trade, let’s call him King David, emailed this morning,