This chart looks like my middle child’s room. To quote a move line from The Replacements, “I’ve seen monkey shit fights at the zoo that are more organized than this!” At first glance, there is not much order to it.
However, this looks like a failed downside breakout, that retested support turned resistance and broke lower. Which is certainly a pattern I recognize. It just does not look very orderly.
We are now approaching our next support level. If the market wants to recover, it will need to hold between 6550-6600. It is very possible that gets tested on Monday. If it does not hold there, A regroup at the 6450 level seems like the next logical battle front.
It is not likely we are headed into a recession, so it does not seem likely it will go down much lower than that….at least based on the information today. Lots can certainly change. Slower growth for the last half of the year was always in the marco economic forecast…and that was before the Iran conflict. A pull pack of some kind really needed to happen-especially at current valuations.
Source: https://www.multpl.com/shiller-pe
The 52 Week High/Low is now squarely negative and has not reversed. I am now waiting to see where the market finds a bottom and I can be aggressive going long again.
The day trading testing has run its course. I learned some things. At the end of the day, it takes too much time and I don’t enjoy it. There are some things I am still testing with it, but ultimately think I will eventually abandoned it. The big lesson is I do think I have a better method of deciding which direction to trade and I am now testing it with with swing trading. It is too early to tell what the results will be, but my way too early thought is encouraging. I will likely have to try a few modifications before I find something that works the way I want. At the end of the day, the goal is for it to take less time than what I was trying day trading and to have a more objective way to decide direction. What I am doing now is a little too much on feel and not enough on data.
