Two plays in one? It’s all in the timing…
Buy signal on Swing / Long @ 310 on the 1-year chart. Stop 283. This is probably the easier trade, but the R-value (risk/reward) is a little low, a little closer to R=1.
Short signal on the DAY/ SHORT @ <310 , Cover @ Friday’s afternoon high, 314.06. Rationale can be seen in final hour of trading. All short covering into the weekend.
15:25 – 15:35 – was a confirmed rally. This rally extended, but during a sharp reversal of the VIX…
15:40 -15:150 – No strong bars on its 3 point rally, all panic covering.
After all the weak shorts have been shaken out, a VIX explosion to the upside will bring this back down to retest 300 (its just a whole number, but whatever, that’s what everyone looks at). But looking at the yearly chart, its next support is around 275. Nice size R on this one if you’re successful on the day trade and decide to ride out a portion into a swing short.
So either way you look at it, you can be long or short and get it right. Volatility is the name of the game at the moment, so shorting on market reversals is more profitable, but as usual, need that STOP set before you enter.
Day short @310 (STOP = 314.06 || 323.47)
Day short @314 (STOP = 323.47)