«So much for a quiet end to the year.»
Traders,
Thursday’s manic movement had traders suffering from wicked whiplash. Stocks plunged for the first four hours of the day, with nary a buyer in sight. The 9 EMA on the 5-minute chart was oppressive. Like Dikembe Mutombo of old, it stood atop the price and swatted every single rally.
No, No, No!
And then, the clock struck 1:30 PM on the nose, and the market ripped for the next 2.5 hours, erasing much of the decline.
▶Bulls who puked up their positions near the lows looked a fool by day’s end.
▶Bears who chased new shorts into the hole got squeezed into the close.
Beware high volatility environments. They’re treacherous. A few tips.
- Less is more.
- Be patient and wait for a proper setup.
- Scale in. You’ll probably get a second chance to enter at a better price.
- Sitting on the sidelines until the madness settles is always an option.
Merry Christmas!
Video Of The Day: Gino’s Gems – How to use the Average True Range indicator (ATR)
In today’s Gino’s Gems, Coach Gino teaches how to use the Average True Range indicator (ATR).
Chart of the Day: S&P 500 (SPY)
Note the role of the 9 EMA as support/resistance during yesterday’s session.
Options Theory Blog
Options Order Entry
Today’s video provides some best practices for building options orders using ThinkorSwim.
Today’s line up
Traders Lounge 11 AM EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
Cash Flow Club Replay
If you missed last night’s webinar where Coach Greg Holmes talked about Managing Credit Spreads or would like to watch it again, check it out here.
Halftime Report 12:30 PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only Matt and Tim can deliver.
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