Monday Gut Check

Today was designed to frighten late longs. It was an arctic gust to the face knocking them down to their tush. Now their pasty face has blisters and flashbacks of prior corrections are swirling to the frontal lobe.

Relax. This was sort of expected.

Will it go faster? That should be your primary concern. The Nasdaq did something today that raised a contextual flag. It printed a double low at intermediate term balance low. The last three days of overlapping balance were all fine and dandy until this occurrence at 4191.50. Now you may find such granular observations to be trivial but I assure you in my approach they are anything but.

They mean the difference between triggering longs or hand sitting.

This needs to be resolved, and it might happen just as soon as tonight. Starting with tonight’s sit in the futures, I am calling for an overnight drift lower towards the low of today. I laid out four bets as part of my Weekly Strategy Session-contextual bets on the direction of each major equity index. This context piece on the Nasdaq puts my bullish call on this instrument at risk.

Moving on, I sold and raised some cash all morning, and when I could no longer resist, though it might have been prudent to resist, I started a position in SUNE. It is trading right at my risk threshold and management is relatively easy for me at this juncture. If it opens lower tomorrow, I will be very busy elsewhere, laser focused on the Nasdaq. I don’t watch stocks on the open, they are too random for my liking. Then, at some point, I will sashay over to the SUNE ticker and see how it has fared through the noisy open. If it has decidedly turned lower, I will cut it, poof, go away silly acronym, you no longer please me.

Plan, execute, manage.