{"id":8820,"date":"2018-03-12T07:30:59","date_gmt":"2018-03-12T11:30:59","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=8820"},"modified":"2018-03-12T07:30:59","modified_gmt":"2018-03-12T11:30:59","slug":"why-you-should-go-short-today","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/why-you-should-go-short-today\/","title":{"rendered":"Why You Should Go Short Today"},"content":{"rendered":"

The S&P 500 closed Friday almost exactly where it was two weeks ago. Most of the technical indicators closed at the same levels they were at two weeks ago, as well. That just might spell short-term trouble for the bulls.<\/p>\n

Look at this 15-minute chart of the S&P 500\u2026<\/p>\n

\"\"<\/p>\n

There\u2019s a lot going on with this chart, so we\u2019ll just go through it one by one\u2026<\/p>\n

First off, the S&P closed Friday right at the resistance of the late February high. Notice how the rally going into that high is identical to Friday\u2019s rally. Specifically, the move started with a sharp spike higher. Then the market spent an entire day steadily grinding out more gains.<\/p>\n

Meanwhile, the MACD momentum indicator<\/a> at the bottom of the chart failed to rally with the index. This \u201cnegative divergence\u201d on the MACD was a strong clue back in late February that we might get a downside reversal. We\u2019re getting the same strong clue right now.<\/p>\n

Also, the Relative Strength Index (RSI)<\/a> at the top of the chart popped into overbought territory on Friday. It had the same condition in late February.<\/p>\n

Now\u2026 consider this\u2026<\/p>\n

Go back and read the Market Minute <\/i>essay I wrote on February 27<\/a> \u2013 the last time the stock market was in its current condition. I could write the exact same essay today.<\/p>\n

It looks like the bulls have taken back the momentum. It\u2019s hard to justify a short position here. But the best trading philosophy of late has been to fade the prevailing opinions of the financial television talking heads. Indeed, it was their overwhelming bearishness last Wednesday that convinced me to cover my short trades<\/a>.<\/p>\n

Now, after Friday\u2019s big rally, it seems that all of the talking heads are bullish again.<\/p>\n

That\u2019s just another item \u2013 in a long list of similarities \u2013 between the market condition right now and the way it looked in late February, just before stocks suffered a swift three-day decline.<\/p>\n

Keep in mind\u2026 most of the patterns on a 15-minute chart tend to play out within one to three days. So, I\u2019m only looking for a short-term decline. But if it\u2019s anything like we saw earlier this month, it could be a profitable trade for aggressive short sellers.<\/p>\n

Best regards and good trading,<\/p>\n

<\/p>\n

Jeff Clark<\/p>\n

Reader Mailbag<\/h2>\n

Jeff, just a quick note of appreciation for your service. I\u2019ve been tiptoeing into options trading for about a year now and your service is invaluable. I still make small trades as I learn, but your recommendations \u2013 and explanations on how and why you make them \u2013 have certainly been profitable more often than not.<\/p>\n

I also wanted to mention I was really happy for the most recent SDS trade. I hate to leave cash idle earning nothing, but in this market, I agree with you that there\u2019s more downside potential than up. So, I loved your SDS trade. I made a tidy 1.5% on a trade held for about 10 hours overnight. No complaints here on that. It was a quick, low-risk trade in a very nutty market. I\u2019d love to see more similar quick low-risk trades when you see the set up. I was really surprised that feedback may have led you to believe you needed to repeat\/justify your thinking on that trade. Thanks again for all of your great work.<\/p>\n

\u2013 Gregory<\/strong><\/p>\n<\/blockquote>\n

 <\/p>\n

Thanks Jeff, I am retired as of 12\/31\/17. My passion was helping people also, but in a hospital lab setting. I miss it! I hope to do well with your trading system so I can once again help others. Thank you.<\/p>\n

\u2013 Crystal<\/strong><\/p>\n<\/blockquote>\n

 <\/p>\n

Hi Jeff, it is so nice to read your newsletters, especially for us that our mother tongue is not English. So I also learn how to say things the right way. Last trade with SDS I made $18. I laughed. And a nice feeling got me all around. I made 18 bucks. And 18 bucks is more than 17 or 16. I remember your words, taking profits consistently keep you on the game. So true. I have an average profit record following your advices of around $100 per trade. Including in the average the ones we did not make money. So the $18 was kind of joke, but reminded me your wise words. I really don\u2019t have a clue how the market works, what makes it move up or down. My goal to stay sharp, is understanding exactly what you are trying to advise and just follow it. You are the expert, this is why I am subscribed to your service.<\/p>\n

\u2013 Juan <\/strong><\/p>\n<\/blockquote>\n

Thanks, as always, for all your valuable feedback. Please continue sending your comments, questions, and trading stories right here<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

The popular trade right now is to buy. Here\u2019s why that probably isn\u2019t right…<\/p>\n","protected":false},"author":25,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-8820","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/8820","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/25"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=8820"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/8820\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=8820"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=8820"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=8820"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=8820"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=8820"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=8820"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=8820"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}