By: Steve Smith
Ok, so I’m joking. I know that Barron’s isn’t reading this email (although some of the individual reporters might be.)
However, Barron’s did a story that highlighted the importance of the 50-day moving average, just like I told you on Friday. Specifically, I wrote:
“A break of this level would target a move down to $435 level which would constitute 4.5% drop from the highs which is still less than half the 10% decline which defines a “correction.” The SPY and QQQ haven’t had a correction for 219-plus days; the second-longest streak in the past 5 years. Over the past 20 years, the market has averaged three 5% pullbacks and one 10% correction annually. This explains why market pundits have been saying stocks are overdue for a more significant pullback. “
Today we cracked $435, but we still have a way to go before we hit a 10% correction, somewhere around $425.
And I wouldn’t be terribly upset to see a 10% correction, frankly.
Look, we need pullbacks. It’s healthy for the market…
A healthy pullback can help create a new support, which can help the market move higher.
Not only that, it’s difficult to find great setups when every chart is moving up and to the right – like it’s following a ruler.
Here’s my point, don’t be scared – this is a good thing and will help us make more money over the last few months of the year.
The “sell in May and go away” sentiment will be disappearing over the next few weeks, and the last quarter should be strong for traders like us.
In Options360, we have reduced our positions and risk and we’re getting ready for some fresh setups over the next week or so.
I predict that the next few weeks are going to be VERY profitable for my subscribers.
It’s going to be exciting, and you can come for the ride with us for just $19.
To Your Success,
PS. I’m going to level with you, the last 3 weeks have been tough in Options360, but we are still killing the S&P. Our YTD returns are about 32% higher than the benchmark index.
That’s because we are agile and have all the tools.
I expect to double our YTD return over the last quarter. No promises – but it’s my expectation.
Click here and join the party before you miss another amazing trade.