Waiting on the Buy

Good evening!

I took a few days off from any updates because nothing had really changed from my perspective. This seems odd as there has been so much volatility in the market lately. Basically the markets have been getting slaughtered over the past few trading sessions. In my previous post I discussed how the XLE is in a long term downtrend. This has proven true as energy has been hit hard. Not good for me. I'm still holding my ERX even though it's a significant loser. Today was nice, but as I'll discuss later, it is likely short lived. The SPY and Q's however, are not quite in a long term downtrend. We have not fallen below the lows from August, which leaves them on the table for me as potential longs.

The chart above is XLE on a 15 minute period. The red line is showing the area I expect this bounce to reach. This is around the 58.25 area. While that's the area I'm looking at, today we actually reached an area for an intermediate term top. We can still move higher, but this will probably not last. I am not a short seller here though, that time has passed for me. So for now, we just wait and see what happens.

The chart above is a 15 minute SPY. Again I've shown the red line indicating where I believe this move is heading, which is around the 200 level. This bounce has been intermediate term playable, but I chose not to participate. Now, here's the interesting part... As I stated above we are not actually in a long term downtrend yet. Lets say we move upward tomorrow maybe again to the 195 area, move back lower but form a higher low, I would be willing to enter a long term long trade. As for now, we wait. Boring, I know.

The chart above is a 15 minute QQQ. Similar to SPY, the Q's are not yet in a long term downtrend, so I am looking at this area for a bottom. Oddly enough, if we break the red line, or the 106 area, I will enter a long position on the Q's. While I don't feel extremely confident about this, it's what the chart is telling me, and the point of this blog is to hold myself to the strategy. This would be a long term trade, likely over a month holding period. I will post any moves to Twitter and this blog. So stay tuned, but for now we wait.

Thank you all for reading!
Good luck tomorrow.

TraderSchmo