Hey Market Pilots,
If this isn’t your first time coming across me as a trader, then you are probably familiar with my favorite setup which I call the Moxie Trampoline Move. For those of you who aren’t familiar, this move happens when price is below the 50 SMA but Moxie is over zero.
It has become my favorite because of its strength and reliability. So when the SPY gapped below the Hourly 50 SMA and Moxie was still over zero (the tried and true Trampoline configuration) I saw an opportunity, while others may have been seeing weakness.
Last week, I had been telling my subscribers that the market was overbought and at resistance. This was fairly easy to assess and so I cautioned our traders and then told them some of what I was looking for in the way of support, namely the Hourly 50 SMA. We never know how the market is going to move, so instead of a direct bounce off of the 50 SMA, price decided to drop below the MA and probably stirred up some liquidity via stops.
But for me, and anyone who has studied the Moxie Method, I saw an opportunity in the form of the Trampoline Move I mentioned earlier. I know Friday’s close may have felt weak and left us scratching our heads, but keep in mind it was options expiration and there could have been a lot of jockeying for position before things expired. Assuming the market holds up and this Trampoline Move comes through, I am looking forward to the week and we should be seeing strength out there until the election jitters really kick in.
Over and Out,
Your Profit Pilot.