Tuesday, February 6, 2018

Gap Down Indicated This Morning - Probably Short Term Exhaustion

Currently there is a gap down indicated of over 1% in SPY though future have moved pretty wildly and that could change in the next 30 minutes until open.

Based on scans of past similar violent sell offs, which where followed by a large gap down opening, the gap down has strongly tended to have heavy buying interest come in after the open.

On average it has been a big win to purchase at the open and hold until the close in these situations in the past.

There is strong peak in future closing returns at 4-5 days out from the gap down open in similar situations.

I have orders to exit SPXU I am holding at the open.

I have orders to buy some call options expiring tomorrow, and next Wednesday play on the consistent rebound pattern that has occurred after past big sell offs and gap downs to capitulate.


Pete

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