Sunday, November 11, 2018

Tick Tock ... Tick Tock ...

SGS  Market Timer Status:  SHORT 
SHORT as of the close of Friday Oct 5, 2018
SGS is a Long-Term (weeks to months) Timer
Why Market Timing Is A Must

Last week, I outlined three scenarios for the mid-term election outcome and the most likely scenario (Scenario A Bad: Reps lose the House, keep the Senate but lose most of state gubernatorial and local races) occurred.  Initially indices rallied on the back of incorrect assessment that the election was a big victory for Republicans but later in the week after the dust settled, it became clear that the big winner was the Democratic Party.

I believe the recent sell-off is a warning of an event that could send indices much lower. I don't know what that event might be but my best guess is that it would be a political event and very likely related to Trump.

SGS advanced last week but it is still in SHORT territory, signalling that there is a good chance that the sell-off that started last Thursday continues.

Supports and resistances for SPX for the upcoming week are shown above. Last Friday,  SPX 200 D-SMA was tested and it held.  There is a good chance that the 200 D-SMA (2763) is breached and SPX trades and closes below it. Should that happen sometime early this week, SPX very likely sells-off to test its recent low (2603) later in the week.

My Plan

No change since last week.  I'm still expecting a panic selling event in very near future.  My plan is to close my long SPXU positions into that panic. 

Current Long-Term Portfolio (2018)
Past Long-Term Portfolios (2008-2017)

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line
TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.