November 06th, 2018

Our Macro Monday trading meeting video is here. We unveil of our ETF investing strategy using Chaikin's new ETF Power Gauge ratings and our strong belief in using Relative Strength to drive portfolio composition.   We'll begin trading Thursday and mange trades every Thursday and/or Friday after that.  We'll post our results each week.   This is a little different for us, as we move our timeframe from a 45 day option trading mentality to an active investing timeframe of 6 months to two years.  

Tuesday morning trading update (pre-market).  Futures off slightly.  Market has hit its head predictably on the 50% retracement level of the current short term downtrend, with the $VIX holding the 20 level, so traders aren't panicking into today's election.   We expect a light volume pullback to confirm the recent low or for SPY to put in a higher low, followed by a Santa Claus Rally.  The retest could happen in after hours trading as election returns are likely to produce some swings until results firm.  The tell is the new Chaikin SPY ETF Power Gauge rating of Neutral Plus, along with with improvements of the XLK and XLY Power Gauges to Neutral +.   

Neutral Plus or better is considered bullish, despite the the unfavorable Power Bar differentials on the index and underlying stocks.  Our buying would be cautiously bullish after a successful technical conformation of the recent low.  By no means do we see evidence of an impending explosive market rally, but aren't betting on Armageddon either.   
A Republican sweep of House and Senate could cause a more enthusiastic trading rally than we're expecting.