I am very bearish too.
There are too many mixed signals to ignore, clearly an old bull ready to be put down but no one has the… Wheaties to finish the job and so everyone just passes the responsibility along. I think it is better to get it out of the way now, and start looking for another bull to pin some ribbons on it’ll be much more economical in the long run and give the bears something to eat because if they come out of hibernation starving they could eat for a very long time.

Just my thoughts.

Interesting. That hot ISM Non-manufacturing (services, construction, etc..) index number certainly doesn’t mesh with Tuesday’s ISM Manufacturing big drop & contractionary reading but as that article says, certainly doesn’t help to support the case for more aggressive easing by the Fed. While I don’t expect the Fed to hold tight, I do think this should push the odds back towards a 25bp cut away from the 50bp the market was hoping for & as such (and if so), that could help to contribute to a reversal in the stock market & failure of today’s breakout.

We have the Employment Situation report tomorrow at 8:30 followed by J. Powell speaking at 12:30 so I would suspect even the slightest shift or perception that Powell has notched down a bit less dovish could trigger a drop in equities but of course, that can go the other way as well (more dovish Powell = fuel for equities). The remainder of this week should be quite interesting. Thx for sharing.

That depends on several variables including your cost basis/entry price(s), trading plan, risk tolerance/loss-allowance, views on whether or not this breakout will lead to a much larger rally, etc. I can’t advise anyone what to do but I’m always glad to share my thoughts as to what I think or what I am doing with my own positions.

If you shorted QQQ when the official trade was added back on Aug 13th right at the top of the Aug-Sept trading range or on any of the subsequent bounces back up to the top of the range that were highlighted as objective shorting opps at the time, or even anywhere down to the mid-point of the range, then you might want to sit tight to see whether or not this breakout sticks as your position would only be slightly underwater. Up to you but that’s my preference.

I think that shorting QQQ or SPY on the breakout today with stops anywhere from 1-5% above offers an extremely attractive R/R should the breakout end up failing. Shorting the breakout is certainly an aggressive strategy that goes against basic TA/trading rules, which say to go long on a breakout. However, the above-average gain potential, should the breakout fail, plus my read on the charts (right or wrong) which says the chance that this breakout will likely fail within a week or less, makes it compelling IMO.

Of course, the less-aggressive & higher-probability entry would simply be to wait & see if the breakout does fail with conviction before shorting. That would provide a less-favorable entry price but a higher chance of success & still plenty of downside (profit) potential so not a bad way to go (or split the difference & do both with a 1/2 short position on the breakout today, adding the other 1/2 if & when it becomes clear that the breakout has failed).