Technical evidence indicates major price movement starting

From Futures Magazine today:

“Last Friday, January 15, 2016, the SPX broke below its Aug. 24, 2015 low, which is equivalent to a major sell signal if price closes the month below that level.

Last week, The Dow Jones Industrial Average slumped 511 points, or 3.1%, to 15,866, while the S&P 500 slid 64 points, or 3.4%, to 1,856.34, led by the financials, technology and energy sectors. The Nasdaq Composite tumbled 190 points, or 4.1%, to 4,424.35.”

Click here for full article

 

The S&P 500 Futures, China Debauchery and the ‘Bus’ Too Full

A couple excerpts from Friday’s Mr. TopStep’s morning Opening Print:

“China continues to dominate the news headlines and the algorithmic and HFT trading programs have done a great job of exploiting the price action in the S&P futures. For the second time this week the Chinese government shutdown it’s main stock index, the Shanghai Composite down two days in a row, down ‘limit’ at -7% each day. Yesterday the Chinese announced that they would be removing the circuit breaker and after the S&P futures fell sharply overnight down to 1930 there was more than a 30 handle rally back up to 1969.00 but quickly reversed when crude oil fell to a new low. The VIX never sold off as the S&P futures rallied and after the rally the ESH15 sold off all the way back down to 1932.50 around 1:30 CT. It was a wild day of ups and down and it doesn’t feel like the jump in volatility is going to subside anytime soon.”

“China  caused several letdowns in 2015 of which the S&P recovered fairly quickly after. While we understand the gravity of the problem and the overall weakness in the stock market, we cannot rule out some type of bounce. One of the things that I cannot abandon is how resilient the US stock markets and the S&P 500 has been as a whole. As money moves out of an overseas market it has to go somewhere, right now the S&P 500 is still the best place to put your money especially after big decline when everyone gets bearish. I still don’t feel overly negative or overly positive about either direction. It’s just too early in the year and there is just too much volatility.”

As always, a good read.  Click here for full piece.

 

The S&P 500 Futures and the Chinese Paper Tiger

Check out this morning’s piece from Mr. TopStep.  Some good thinking to consider regardless of what market you trade:

“As futures traders we try to get in and get out, but when the markets are this volatile and moving this much, it’s imperative that you define your risk and use stops. These are the types of markets that when you’re wrong it’s best just to get out and start over. A few days ago someone on Twitter talked about adding to a losing position. I understand the idea of averaging up or down, but I also understand that when there are 30 to 50 handle range days, adding to losers can blow up an account in minutes. That is why we continue to think as a scalper, get in, get out, don’t fall in love with your position.”

Have a great day,

Rob

Click here for the full piece:  http://bit.ly/1Rc4XlI