When credit tightens, the markets respond in kind with less to invest. We’ve seen that happen in the latest cycle of weakness.
Stock market futures are lower once again and the S&P 500 is wishing 2 percent of the October lows. Note that the Nasdaq is making new lows.
The days of the stockpicker are once again upon us.
For traders in the futures space who speculate and hedge, the seas becomes a bit more difficult to navigate with sharp fades and bounces – short term engagement with level to level motion is important. Traders should be watching support action and WAITING for price resolution to engage.
The trend is definitely negative and places like the mini Nasdaq Futures will reflect the difficulty of the instruments in this space under the spectre of more expensive debt. (Also true for the Russell 2000 futures).
As we can now see, the more times we drift back to support, the more dangerous it becomes to “pick the bottom”. Pay close attention to the levels above and below as they are likely to give us reversal patterns at the first pass. See video for full detail of my thoughts.
Stock Market Futures Video Update – November 20, 2018
The author trades stock market futures every day and may have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.