Be on Alert for More Sells in the Morning

Be on Alert for More Sells in the Morning

The overseas markets broke out of this week’s range tonight, carrying the NASDAQ 100 and S&P 500 Futures a good distance above the Weekly Expected Move highs. 

If New York opens at these levels or higher, market makers may have to scramble and buy even more futures to neutralize their deltas before Friday’s expiration. I want to sell our remaining S&P 500, NASDAQ 100 futures, and XLF option swing positions into that strength. 

As I have discussed this past week, Blowing through the expected moves is a rare event, and I want to take advantage. So far, this is happening in Globex, which is not the most reliable indication if not confirmed in regular session trading. 

Nevertheless, if this breakout follows through in the regular session tomorrow, I would attribute it to the power of a volatility squeeze firing long as we are witnessing in the NASDAQ 100 index.

I may also want to add to our gold (GLD) position and expect to see our energy position (XLE) pick up, or it will be disposed of summarily, as it is the only drag on the portfolio in this latest run. 

Stay tuned.

A.F. Thornton

AF Thornton

Website: https://tradingarchimedes.com

A.F. "Arthur" Thornton is an expert in logic, risk/reward quantification, market fractals, pattern recognition and asset class behavioral analysis with 34 years devoted to developing algorithmic and quantitative trading systems. In addition to trading his own capital, Mr. Thornton designs custom algorithmic and quantitative trading systems for a small and exclusive group of exceptionally qualified traders.

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