No need to update this morning’s chart. It’ll be out of date by the time you see it, anyway, given that stocks are falling about 1pt every 20-seconds.
As of this instant the S&P500 is 60pts off the highs of the day at around 1890. I would expect (but am not betting on) stocks regaining 1900 by the close.
At 1870 I am a buyer in some size of equities across the board. Sell-offs are about emotion. If bear markets went down in a straight line they wouldn’t be at all scary. You could just short everything. There is going to be a hellaciously vigorous rally very soon. The question is whether it’s from here or 10% lower.
Today is the first day I’ve heard (felt) real concern from the bulls. That’s the start of a bottom.
Earlier this week I said the time to buy would be when getting long felt completely insane. Being a contrarian is overrated but there’s a 20-minute wait to buy a PowerBall ticket but it would take a nanosecond to get filled on $250,000 worth of Amazon $100 lower than where it was 2 weeks ago.
It’s time to start getting constructive on stocks.
1867 might be support but the termites are rotting the wood in that floor. You crazy Macke.
It’s trading like the fires of hell are burning the floor, termites and all.
The level is almost too widely watched. Only other reasonable reference is 1820 Ebola low. Other than that we need fundamentals which are largely unknowable.
So… Shit.
Hi Jeff, really appreciate and enjoy your analysis, especially in a day like today. Per your last post, you mentioned that 1860 is the lower range of support and if it drops lower, then look out below. But, in this you discuss going long at 1870. Are you saying that you would have a stop around 1857 or something along those lines to limit your loss? Not trolling by any means, just want to hear your thoughts. Thanks in advance!
I meant today as we were getting really oversold.
This is just hideous price action. Divide your investment into parcels and “leg in” ~1/10th (or 1/4) at a time.
The S&P is down 10% in a straight line. Discretion is the better part of valor.
Makes sense, I appreciate the response and really enjoying your work. I’m not much of a technical analysis investor, but I can appreciate any system that institutes controls and risk management. Either way, I’m learning which is all I can ask for.
Great lotto analogy
I would love for the contrarian view to be that conventional pauses & retraces don’t necessarily happen unconditionally. Everyone expects that 1880 level so why shouldn’t an alternate outcome possibly present itself. Pavlov comes to mind also after 6yrs of heavily manipulated equities…