/NQ (Nasdaq 100 futures) & /ES (S&P 500 futures) both went on to breakdown, backtest, & followed by a rejection of the 10-minute rising wedge patterns posted late yesterday. Those previous (yesterday’s) charts, followed by the updated 10-minute charts, along with a couple of adjustments to some of the nearby support & resistance levels.
NQ 10m April 6th
NQ 10m April 7th
ES 10m April 6th
ES 10m April 7th
I still think a short on crude oil (/CL, /QM, /MCL, USO, SCO, etc.) can serve as an indirect hedge to a short on the stock index futures or ETFs, making the proper beta-adjustment between the two (crude tends to move up & down more, so a smaller short on crude vs. the index short).
Should the inverse correlation between the two continue, then it is roughly a wash (i.e., a roughly equal hedge). However, I think there is a decent chance that sooner than later, we will start to see crude prices pull back, but remain at levels that are restrictive to economic growth, thereby resulting in weakness in equities.