In my last column dated Sunday, August 17th, I disclosed that I had executed 25% of my overall planned short position in the S&P 500 Index late Thursday, August 14th and another 25% on Friday, August 15th. Today, August 19th, I completed my planned short position by executing the remaining 50%. For trading purposes, I like to use the ProShares UltraShort SDS ETF when attempting to capitalize on any expected downturn in the S&P 500 Index. This product is extremely liquid and has a nice "kick" to it when the trade goes your way.
For bullish traders and investors, today's NYSE afternoon close has to be "nirvana" with the Nasdaq Composite Index now at its highest level since March 2000 (which was arguably the greatest stock market top on record). Apple posted a record closing high today, eclipsing its previous high set in September 2012. However, it may be noteworthy that the record intra-day high for Apple from September 2012 was missed by a few cents today. No worries, though, as I am sure the new iPhone will be great. Home Depot jumped 5.55% today on better-than-expected earnings and a positive outlook from management for the next several quarters. And most major stock market indexes are now within a stone's throw of their all-time highs as set last month. Like I said, nirvana is a perfect description for the feelings that bullish traders and investors must be experiencing right now.
And maybe there will be a couple of more days of this bullish glow and nirvana-like feelings, but the tide has already turned and the expected downturn in the U.S. stock market will be sharp and swift. In 1987, the high for the year in the S&P 500 was posted on August 25th. There are three more trading days this week before Monday's August 25th anniversary date. Do the bulls even have this much time (three days) before the expected market slide begins? Probably not!
 |
| Russell 2000 Index Monthly Chart with Computer-generated Buy & Sell Signals |
No comments:
Post a Comment