Powell testified in front of the Congress and tanked the market. But did he?

Maybe he sparked this selling but it was expected. We recovered most of the correction in a fast pace. This recent correction was fast and in one wave and we recovered in the same fast pace… and in one wave.

However, the selling happened in a very light volume:

 

 

A low volume pullback is a technical correction toward an area of support that occurs on lower-than-average volume. Since the move occurs on low volume, traders often attribute the pullback to weak longs locking in profits rather than a reversal. (Investopedia.com)

If this definition is correct and we are really in a “technical pullback” then this is a profit taking event, healthy for the market, and the uptrend should resume (and since I have a few bullish trades I wish it is what will be happening in the next few days).

Yesterday, I posted “We may see a small pullback to 50 DMA but we most likely continue higher as per my previous estimate…” and it seems that this is exactly what has happened today. In fact, I think it is something what was supposed to happen despite Powell’s testimony.

However, this selling derailed me and I made a few trades out of discomfort. Yes, I collected more premiums but, as I stated, I wasn’t much happy with those trades.

I had to close my trading platform to not get sucked in more trading.

 

 · Trading activity today

 

Although, we collected nice premiums trading today, I am not much happy with it. The trades were driven by emotions and not by calm trading. Followers of our trading and this blog may remember that I strive to trade without emotions and without panicking. I strive to control myself and always be in a “comfort zone”.
 

I must admit, I failed today.
 

Here is a summary of opening and closing trades.
(balance + $435.00)
 

 

Let’s see what next few days bring. I assume we may see some downward pressure to continue but more buyers will for sure step in and continue buying. The odds of larger pullback though are very low.