Welcome to the Weekly Game Plan! The 'MARA Lists' are updated in real-time. The 'Market Summary' is provided weekly. The 'Deep Dive Video' is the recording of our weekly Trading Prep DEEP DIVE.
MARA List
Market Summary
MARKET MOOD: RED
The summary below is my interpretation of the data in the ‘Market Mood Log’ above:
Big sell off on Friday: The sell off took the S&P 500 and NASDAQ down to their 10wk lines and prior resistance. It sent the Russell 2000, NYSE, and Dow below their 50smas, 100emas, and the Russell 2000 below its 200sma. Each closed near its lows for the week.
New lows continued to outpace new highs: this has been the case for about a week and a half now and the market finally cracked. If this were the only flag, I’d be more inclined to bet on a snapback rally and expect it to follow through.
Distribution is still relatively low. There’s only 4 distribution days over the past 25 on both the S&P 500 and Dow. Friday was one heck of a distribution day though! A definitive character change.
There are 7 stocks total on the trade ideas list, 6 longs and 1 short. This is the fewest we’ve had all year. That says something. If the shelves are empty, is it a time to buy?
I’m in cash. I sold off my swing trades on Monday of last week and have been in cash since.
HOW I’M PLAYING THIS HAND: For now, I’m planning to continue to sit in cash while watching the handful of names on the watch list to see what they do. If I see follow through to the downside and I see additional short setups, I may go short. If I see upside reversals or supportive action, I’ll look closer at bullish ideas. Cash is a position and I don’t mind holding it for now.
Best Selling Author – Trading Coach – Creator of the Trade Gauntlet – Founder of MaraWealth.com
DISCLAIMER: Futures, stocks, and options trading involves a substantial risk of loss and is not suitable for every investor. The valuation of futures, stocks, and options may fluctuate, and, as a result, clients may lose more than their original investment. The impact of seasonal and geopolitical events is already factored into market prices. The highly leveraged nature of futures trading means that small market movements will have a great impact on your trading account and this can work against you, leading to large losses, or can work for you, leading to large gains. If the market moves against you, you may sustain a total loss greater than the amount you deposited into your account. You are responsible for all the risks and financial resources you use and for the chosen trading system. You should not engage in trading unless you fully understand the nature of the transactions you are entering into and the extent of your exposure to loss. If you do not fully understand these risks you must seek independent advice from your financial advisor. All trading strategies are used at your own risk. Any content on marawealth.com should not be relied upon as advice or construed as providing recommendations of any kind. It is your responsibility to confirm and decide which trades to make. Trade only with risk capital; that is, trade with money that, if lost, will not adversely impact your lifestyle and your ability to meet your financial obligations. Past results are no indication of future performance. In no event should the content of this correspondence be construed as an express or implied promise or guarantee. marawealth.com or Mara Wealth LLC. is not responsible for any losses incurred as a result of using any of our trading strategies. Loss-limiting strategies such as stop-loss orders may not be effective because market conditions or technological issues may make it impossible to execute such orders. Likewise, strategies using combinations of options and/or futures positions such as “spread” or “straddle” trades may be just as risky as simple long and short positions. Information provided in this correspondence is intended solely for informational purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.
