Buy the Dips and Sell the Rips Until Further Notice:
Buy the dips and sell the rips: Equities are seeing a slight pullback from the highs this morning.
On Friday's encouraging jobs data, the S&P was able to trade to its highest level since 2007. The market is currently trading at 1455, as it consolidated above the midpoint of the range since the year began.
With light data today and tomorrow out of the U.S., the focus will be on the earnings season that will start after the closing bell tomorrow. I do not expect traders to make any big bets ahead of tomorrow, and in fact I expect the market to trade slightly lower, as we see some profit-taking. I will look for a buying opportunity as at 1441. A close below 1438 will be negative; the next support comes in at 1431.75, and at these levels, we are likely to see further liquidation. A close above 1461-1463 will very bullish.
So what's the bottom line?
I am buying the March e-MINI S&P at 1441.0, with a 1431.0 sell stop. My target is 1461.0. This trade risks $500 to make a potential $1,000.Good Luck and Good Trading.
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