August 22, 2017

Sell-off Continues

Not much to say tonight so I am going to keep it very short tonight. 

As expected, the sharp sell-off at the close yesterday carried over into today’s trading. As a result the S&P experienced its largest loss since August 9th.

Tomorrow brings a bit of positive sentiment in an otherwise historically dismal week (look at Aug 27th post). However, we could see a test of the 1425 area in the S&P before a short-term bounce occurs so who knows if the psitive seasonality takes hold. As I always say, historically biased seasonal conditions are, in most cases, never a reason to place a trade. Although, when coupled with other technical indicators, seasonal factors can be a worthy compliment to making an well-informed trading decision.

If the S&P does not test the 1425 area tomorrow I would expect to see it on Thursday. According to the Stock Trader’s Almanac the “next to the last day of August the Dow and S&P were only up once in the last ten years”. Furthermore, on this particular trading day during the last 21 years the Dow and S&P have only been higher 28.6% and 38.1%, respectively. Of course, I want to see how tomorrow plays out, but if we indeed get a nice rally seasonal conditions could once again play a factor in the price action of the market.

I am currently working on making a blog (daily commentary) section for only newsletter subscribers or subscribers to our strategies. This should be released sometime around September expiration, potentially sooner. This will allow me to discuss in great detail the strategies as well as other topics that directly relate to our strategies. I will also begin following other options-based strategies within this section as well. This will certainly add value to the newsletter as it will allow us a forum to freely discuss, on a daily basis, our thoughts on various market strategies. We will also add more in-depth studies to the blog. Subscribers be on the lookout!  

Overbought/Oversold for August 28, 2007

SPY – 35.8 (neutral)

IWM – 33.1 (neutral)

DIA – 37.1 (neutral)

QQQQ – 38.7 (neutral)

GLD – 47.9 (neutral)

OIH – 49.3 (neutral)

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Andrew Crowder,