The S&P 500 has shown signs of support and resistance at the 2750 handle, an area that we are approaching as a look at the charts. I think that this market will continue to be very difficult to trade, but as you can see I have a purple ellipse on the chart that extends to just above the 2800 level. At the first signs of exhaustion I suspect the sellers will jump in but I think that no matter what happens next this market is going to be very difficult to deal with. Overall, I believe that the sellers did a lot of technical damage so of course it’s going to be difficult for the buyers to hang on. I also believe that if we do not get some type of agreement between the Americans and Chinese – and that’s what I believe will happen – at the Buenos Aires meeting, it’s very likely to have a negative drag on the stock market. As far as buying is concerned, I would be very hesitant to do so, at least not until we get above the 2800 level. I will however not hesitate to short some type of exhaustive candle. At that point, I would anticipate that the market could drop down towards the 2700 level, if not the 2650 level.
S&P 500 Video 07.11.18
I would keep my position size small, because quite frankly this type of market that can cause a lot of volatility and damage to the profit and loss of your trading account. Ultimately, be cautious is the biggest thing.