Interim Update – 9/19/2022

Good Evening:

• Given the positive divergences we highlighted in the pre-market update, it was a busy morning.
• Think of it like this: I sometimes tend to have my finger on the trigger when we are short the market.
• This morning, I had suggested using Friday’s candle as a breakout range. 
• On the NYSE open, traders drove the price down, ran the stops below the Friday low, and then failed to drive prices lower.
• When the breakdown didn’t take, it became a contrary signal – WWSHD.
• Given all we see and the position of the Navigator Algorithm, we covered our short position at 3860.75 for a handsome profit of 266.75 points from our entry on 9/12 at 4127.50. We sold our SPY puts commensurately. 
• Aggressive subscribers with cast-iron stomachs reversed back to long the futures and SPY calls on the signal. Subscribers have the details, prices, and call symbol.
• I know it does not seem to make sense, as everyone predicts a crash. And we will reverse back to cash or short on a dime if required.
• But I expect another small short-covering rally driven by the overly negative sentiment – likely into Wednesday’s Fed announcement and maybe beyond.
• Stops are in the usual places.
• I don’t mind being wrong, as long as we book profits. Personally, I am reluctant to take a long position prior to the Fed meeting, but I did not mind taking profits on the shorts.
• I will be publishing our year-to-date performance soon.
• The numbers are stellar across the board, and we have a chance at four-digit returns – fondly labeled “10-baggers.”
• The label refers to a subscriber account on January 1 worth ten times its starting balance now.

Stay Vigilant, this is the kind of market that confounds even the best of us.

A.F. Thornton