Oil beginning to threaten SIFs
- Thread starter nitro
- Start date
Let us break down the top components of SPX into some factors:
Financials: 16%
Tech: 16%
Energy: 15%
So those three sectors account for nearly 50% of SPX components. Given that NQ is pretty strong, Financials are unch as measured by XLF, and energy slightly lower as measured by XLE, one wonders why ES is not stronger.
I don't know, but this situation will resolve either by NQ coming down, or ES going higher. I doubt meeting in the middle happens.
nitro
Financials: 16%
Tech: 16%
Energy: 15%
So those three sectors account for nearly 50% of SPX components. Given that NQ is pretty strong, Financials are unch as measured by XLF, and energy slightly lower as measured by XLE, one wonders why ES is not stronger.
I don't know, but this situation will resolve either by NQ coming down, or ES going higher. I doubt meeting in the middle happens.
nitro
Looks like a possible explanation is rotation out of energy into tech.
It remains to be seen if that is going from the fire into the frying pan, given that the FED will start to take back cuts in the near future. The rotation should work in the short term, since institutions are far more nimble than they used to be and can exit tech when it becomes wrong. We'll see in a few months time...
That said, I would be very cautious initiating overnight long swings based on today's action. ES doesn't want higher, and this may correct tomorrow. Would I sell short then? Not even with your money [I took profits and stand aside.]
nitro
It remains to be seen if that is going from the fire into the frying pan, given that the FED will start to take back cuts in the near future. The rotation should work in the short term, since institutions are far more nimble than they used to be and can exit tech when it becomes wrong. We'll see in a few months time...
That said, I would be very cautious initiating overnight long swings based on today's action. ES doesn't want higher, and this may correct tomorrow. Would I sell short then? Not even with your money [I took profits and stand aside.]
nitro
This is extremely bearish action, and if SPX breaks 1370 again, it is a tough call whether to sell it short or not with NQ green. Extremely aggressive traders will do it. I won't, or if I did, I would hedge some fraction of the S ES with L NQ, then let go the hedge if NQ goes red (or if you are hyper-aggressive, if NQ "looks" like it cannot withstand staying green). This makes money on lower SIFs, but nowhere near as fast obviously as naked short ES. But the short on a 1370 SPX break is probably odds on no matter what, especially for an overnight swing (which I won't take since I like to sleep).
Imo the two gap fills [XLF and SPX] described in this thread are imminent. When I don't know, but I smell blood, and sharks are nearby.
nitro
Imo the two gap fills [XLF and SPX] described in this thread are imminent. When I don't know, but I smell blood, and sharks are nearby.
nitro
1370 SPX in plain sight again.
Have to buy 1372, only for pros. 2 handle stop loss with a 6 handle profit target. Should you SAR at 1370? Odds on that it works, but it depends on time of day, and remember that if SPX does go to 1370, that would already be a 34 handle loss for the day. Nothing says it can't go far lower though even from there, and if we break 1370 clean, 1342 imminent sometime next week.
nitro
Have to buy 1372, only for pros. 2 handle stop loss with a 6 handle profit target. Should you SAR at 1370? Odds on that it works, but it depends on time of day, and remember that if SPX does go to 1370, that would already be a 34 handle loss for the day. Nothing says it can't go far lower though even from there, and if we break 1370 clean, 1342 imminent sometime next week.
nitro