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By Jani Ziedins | End of Day Analysis
My Trading Diary
The S&P 500 tumbled for a second day, but the losses were relatively mild as compared to recent volatility. Nothing wrong with a little give back following a strong move over the last few weeks. That said, I was feeling defensive and yesterday’s mediocre close convinced me to take profits in 1/3 of my position. No doubt this was premature, but I had profits and I didn’t want to let them get away. Plus I still have 1/3 left and will benefit if prices rebound. And as I often write, I can always get back in.
I still feel good about the medium-term prospects, but we could test the 50dma and 2,950 over the next few days. That would be a normal and healthy thing to do. Or maybe this morning’s dip is as far as we go. Either way, this market wants to go higher, not lower and every dip is a buying opportunity.
My Trading Plan
Most Likely Next Move: A little cool down that will bounce soon. If the bottom isn’t already in, look for a bounce near 2,950ish.
My Trading Plan: Took some profits yesterday, but already looking to get back in if we close well.
If I’m Wrong: Prices undercut 2,950 and that triggers a tidal wave of defensive selling. But as long as we stick to our stops, then all that dip is is another profit opportunity.
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