After the sell off on global markets (Asia and Europe) the US markets are poised to a sharply lower opening. US futures point that the SPY will open at 113 level breaking thru the support of the pennant (or triangle). During the day this gap may be closed, but if the selling pressure during the day will be wild, we may see SPY attacking its next support at 112 level. Remember, it is the closing price which makes signals. If we close below the pennant support, we will attack 112 level this week. If we break 112 level (which I think will happen) we will go to 100 level.
Unfortunately, I am fully invested at this point so my account doesn’t allow me opening another Put position in SPY, which I would definitely do.
Let’s see what’s going to happen today.
Happy trading!
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