ONE OF THE LONGEST PERIODS IN 100 YEARS WITHOUT A 5% CORRECTION

To gain an edge, this is what you need to know today.

Without A Correction

Please click here for a chart of S&P 500 ETF (SPY) which represents the benchmark stock market index S&P 500 (SPX).

Note the following:

• It is the first day of the month. Blind money will pour into Wall Street as is the usual pattern.
• Blind money is the money that investors put in the stock market on the first couple of days every month without any analysis and irrespective of market conditions.
• Typically blind money is invested in the afternoon.  Professional traders are front running now.
• The chart shows that this is one of the longest periods in 100 years that the S&P 500 has gone without a 5% correction.
• In the face of all the bullishness, RSI is showing a divergence.  In plain English, this means that as shown on the chart the price is rising but RSI is making a lower high.  This indicates a loss of internal momentum.
• The chart shows two important support zones.
• It is a seasonally weak period to the end of October.  If there is a correction, the tentative plan is to buy.

Momo Crowd And Smart Money In Stocks

The momo crowd is 🔒 (To see the locked content, please take a 30 day free trial)  stocks in the early trade.  Smart money is🔒.

Gold

The momo crowd is 🔒 gold in the early trade. Smart money is 🔒.

For longer-term, please see gold and silver ratings.

Oil

The momo crowd is 🔒 oil in the early trade.  Smart money is🔒.

For longer-term, please see oil ratings.

Markets

Our very, very short-term early stock market indicator is🔒.  This indicator, with a great track record, is popular among long term investors to stay in tune with the market and among short term traders to independently undertake quick trades.

Interest rates are ticking down and bonds are ticking up.

The dollar is weaker.

Trading futures is not recommended for most investors. The purpose of providing this information is to give an indication of the premarket activity that usually guides the activity when the market opens.

Gold futures are at $1811, silver futures are at $25.41, and oil futures are $73.05.

S&P 500 futures resistance levels are 4460  and 4600: support levels are 4400, 4318, and 4200.

DJIA futures are up 96 points.

Protection Bands and What To Do Now?

It is important for investors to look ahead and not in the rearview mirror.

Consider continuing to hold existing positions. Based on individual risk preference, consider holding 🔒 in cash or treasury bills or short-term bond funds or allocated to short-term tactical trades, and short to medium-term hedges of 🔒, and short term hedges of 🔒. This is a good way to protect yourself and participate in the upside at the same time.

You can determine your protection bands by adding cash to hedges.  The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive.  If you do not hedge, the total cash level should be more than stated above but significantly less than cash plus hedges.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.