Sitting Tight

Today's move was exactly what we forecast as far as price action, thus far it has led exactly to the squeeze that we forecasted, but it's a very different head fake move than past ones and a very dangerous looking one. I'll sit tight on the UVXY short and IWM 7/17 $125 calls, but am very glad I didn't break any rules by adding to positions that weren't confirming.

Right now the best we have is confirmation intraday, the worst we have is non-confirmation is some averages and two very parabolic moves right next to each other.

The real danger with this move is that it suddenly slices back below the 200-day on very little notice, the support or shares Wall Street usually accumulates and sells before a reversal just weren't picked up today. They did just enough to move the market to short squeeze territory after new shorts entered below the 200-day.

This is the difficult thing about confirmation, 99% of the time I don't even need to do it, I do it out of habit and to make double-dog sure things look right. This is the 1% of the time in which that habit is well justified.

I'll ride out UVXY short and IWM calls for as long as we can, but I would not be surprised if this move were a lot more volatile and a lot more surprising in a negative way than what we have seen thus year so far.

If you missed out on a trade here or an add-to, I believe you did the right thing. NOT EVERY PRICE MOVE IS WORTH TRADING, AT LEAST NOT BEYOND SPECULATIVE SIZE. Remember, it's not about probabilities, it's about high probability, low risk trades with excellent timing and it goes without saying, support...this one is sorely lacking that support.

I'll fill you in on the rest of the charts in the Daily Wrap, but right now none of the Index futures are confirming so I'm guessing Wall St. is already selling in to price gains. 

THIS IS WHY I KEEP THE BULK OF MY POSITIONS (CORE/TREND) IN PLACE AND ALIGNED WITH THE PATH OF LEAST RESISTANCE.