Daily Plan 11.17.23
Markets Close Slightly Higher - What's Next?
Welcome back everyone!
First off, we experienced a tremendous earnings session, with two out of three outcomes working in our favor. Walmart was quite the surprise, especially as Target experienced a major rally, which was the exact opposite of what we anticipated. AMAT also worked out well for us, while ROST witnessed a strong move to the upside. It's noteworthy that we started off this year extremely bullish on earnings, but now we are anticipating more downside, a strategy that has proven effective. Below is the list that was posted yesterday, on Sunday:
WMT: Bearish - Target 161.54
AMAT: Bearish - Target 137.97
ROST: Bearish - Target 117.54
Then, moving on to the indices, both the E-mini and Nasdaq were consistently under pressure throughout the session, remaining below my short levels with no bids above. There were numerous opportunities to exit short positions at this level, although the targets were not reached. It was a challenging session for traders who do not take profits, as they saw potential gains diminish. While I usually don’t comment on specific systems other than the Risk Management post in the Education section, employing multiple take-profit strategies is ideal to prevent giving back gains, along with setting a trailing stop.
Oil collapsed once again, breaking through the short target and surpassing my expectations. In contrast, Gold experienced a significant rally, moving sharply upwards. An important observation from today's session was the weakness in the Russell, which might indicate that it could be the first index to encounter aggressive selling. If one were to consider a long position at present, it would be prudent to focus on the Russell during this dip and the Dow, based on the most recent Commitments of Traders (COT) Reports. Both are experiencing extreme positioning, with institutions being heavily long. This is not a trend to oppose; at the very least, it would be wise to remain on the sidelines with these two indices. This caution could also extend to the E-mini and Nasdaq, as I have been anticipating some weakness in these areas.
Now, let's proceed to the remainder of the plan and delve into my thoughts for tomorrow's trading opportunities!