Hey Market Pilots,
Over Christmas weekend, I did my usual weekly video for the Moxie Subscribers and in it, I said that the market should keep going up. Then on Monday the 28th, the SPY opened with a sizable gap up and my guidance was confirmed. My account was up big and grew for the first 30 minutes or so. It was nearly one of the biggest mornings I’ve had and such a short time after the opening bell. I was elated and figured it would be an easy day…
The easy morning pop began to fade as names started to suddenly get hit and plunge lower, with conviction. Tickers were being drilled south in a steady fashion and nothing could save them. A few stops were hit and I quickly got out of a couple of others to help reduce the risk. This was all happening while the market was up in a big way.
I spent the afternoon looking around the market, trying to piece together what was happening and if a trap was about to be sprung on the market in the form of a pop and flop. I did see some troubling signs with the UVXY catching a bid despite the market being up and my indicators warning of a possible reversal. I notified the subscribers and exited several more names to reduce the risk in case I was right and the market wanted to head south.
The market gapped up again on Tuesday, but we were better prepared for it as I told the Moxie Subscribers that price was unlikely to stay up where it would be opening. This indeed was true and more names continued with the stiff drawdowns.
This brings us to Wednesday, the day I am writing this, and the market seems to have amnesia. Stocks are popping up or easily recovering from the previous two days of deep moves. Meanwhile, the indexes stay elevated but don’t budge. It has been some pretty interesting action by individual names as it appears there was a coordinated selling theme on Monday and Tuesday, and then the signal to stop was given on Wednesday. My assessment of this is that the markets are strong overall, but names needed to cycle down to support or blow off steam from their overbought conditions.
Either way, I shook off the crazy activity and didn’t let it unnerve me so I hopped right back into a few names and added to others. Let’s see how it all pans out and I’ll catch you next year.
Over and Out,
Your Profit Pilot.