Again, here's a quick look at the charts, this time specific to each of the assets, but showing the same thing as the major average and Index futures from this morning's
Opening Indications post.
Truth be told, I really wouldn't be too worried about holding UPRO (3x long SPX-500) and FAS (3x long Financials) during such a pullback if I wasn't able to trade more actively. Even the QQQ call position wouldn't be a huge concern being it has quite a bit of time (November 22nd) until expiration, but why sit through the drawdown, especially in the QQQ calls in which that time decay is gone and gone for good?
The intraday target I was looking for on the upside was about last Friday's intraday highs.
The P/L....
The P/L was +1.7%
The P/L was -0.77%
The P/L was +10.95%
Really nothing to write home about, but again, why have open risk on a highly probable pullback which will allow us to repurchase these or other assets at better prices, less risk and without any tail risk or risk of unforeseen events?
The charts...
UPRO intraday was pretty much in line, as was SPY and SPXU, however beyond the slightly longer 2 and 3 min intraday charts, the NYSE TICK was turning down.
With such minimal gains, especially the QQQ calls which could quickly flip from a 10% gain to a 10% loss, I didn't see much point in waiting around much longer.
The UPRO 3 min with the overall, strongest feature being the positive divergence , but the near term negative is just as legitimate and not a contradiction of the earlier signal, just the next turn on the road map as we still head for the same destination.
The UPRO 15 min leading positive divegrence as well as larger base, not only in timeframe (15 min timeframes were the signals we always used for SWING trades before QE and I suspect after QE).
Of course the other notable feature is the size of the base area. Remember, the area in which we first saw a 3C divergence, even though there may be additional accumulation at lower prices creating a much lower average price, is almost always far exceeded; so if you bought on the first sign of the divergence and waited long enough, you could be virtually guaranteed (according to the probabilities) that the position would end with a gain.
FAS-3x long Financials
The intraday 1 min chart going negative this morning
The 2 min which went in to Friday's Week Ahead forecast and its negative divegrence as well as this morning's general target area around Friday's intraday highs.
And the longer FAS 15 min positive divegrence, again with a larger base with almost all showing some sign of having started around Oct. 2nd, just after Window Dressing and Q3 were complete as we speculated the last week of September.
As these bases build out further to the right, the divergences become more pronounced.
QQQ (November 22nd $92 Calls)...
The 1 min intraday lagging as QQQ moves toward Friday's intraday highs.
And the larger 30 min base area, again October 2nd being a prominent feature of the larger divergences as this one goes from a weaker relative positive to the stronger leading positive form.
*I suppose you could fade a downside move or pullback and play it with some leveraged ETFS (short / inverse) like SPXU, SQQQ, SRTY, FAZ, etc... ), however, at this time I'm going to likely just wait largely in cash for a more enticing opportunity, although if charts change and probabilities change, I'll of course bring you the new data and new considerations.
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