Founder’s Trading Journal

• This note supplements yesterday afternoon’s Founder’s Trading Notes from yesterday. Refer to the notes for charts, key levels, and today’s trading plan.
• Premarket indications have us opening in the lower third of the overnight range on 100% net short overnight inventory.
• Tee up Gap Rules this morning, as there is potential for early trade for knowledgeable and experienced traders.
• With the market approaching the 61.9% Fib retracement just above 3900 (bottom of the Fib Buy Zone on yesterday afternoon’s chart), be careful if you intend to initiate any new short positions. The climbing put/call ratio signifies that the short-term decline could end. 
• Price also encounters an uptrend line at 3900, connecting the 6/17 and 7/14 lows, and 3900 is the new Put Wall, often with significant support from the options market. 
• With no pause in the selling since the Powell smackdown of 8/26, the risk of a reflex rally is becoming greater than further declines, at least in the short term.
• As it is the 1st trading day of a new month, positive flows may have a bullish influence on the market, and the shorts are getting too comfortable.
• Price is also at the tip of a falling wedge pattern on the hourly charts, which often leads to a price reversal higher if the pattern takes.
• I often remind myself that pigs get fat and hogs get slaughtered.
• Subscribers can join me in the Founder’s Room this morning.

A.F Thornton