While today's tape is reminiscent of what we've seen as of late, my bias continues to be to the short side until Mr. Market proves me otherwise. I have a methodology and follow it without question (hence the 'trade your plan'). It's easy to fall into the trap of listening to others who you think may have a better read on the tape, but my experience behaving (and trading) in this manner is that it simply ends up screwing with your psychology - big time - because you begin to question your every move.
If the market decides to ramp up I will cut my shorts faster than a bullet. I have no patience to hold onto losing positions.
1938 CORRELATION
The 1938 correlation I displayed in one of my previous posts - INDU Structure - continues to impress. In fact, after updating the data to today's close we now sit at a coefficient equal to 0.80 (up from 0.765).
Dow Jones Industrial Average
(Series 1: 2/23/1938 - 11/10/1938, Series 2: 1/2/2009 - 9/21/2009)
What's interesting is where we are in terms of the 1938 fractal. Check it out...
Dow Jones Industrial Average - 1938
Literally to the day. Right at the top. Absolutely beautiful!
I realize price means everything but if this isn't enough evidence that we are topping, then HERE is more.
Dow Jones Industrial Average - 1938
Literally to the day. Right at the top. Absolutely beautiful!
I realize price means everything but if this isn't enough evidence that we are topping, then HERE is more.
POSITION
I cut my delta exposure down 50% in light of the Power of 9 low at ES 1051. Had we broken those lows, I would have added it back. Better to be safe than sorry as they say.
ES FORECAST
As usual...
Intraday ES Forecast
