Therefore after the government shut down continues in the news over the weekend I expect the market to open negatively on Sunday evening and for this to ultimately kick start the next leg of the down trend although I could be wrong as I didn't expect last week to be so good for this index. It's safest to wait for a confirmation candle which confirms that the hasn't been breached although I have already taken my short position due to the we saw at the end of last week and have hedging positions in place in case the US market continues to look although I doubt that it will. I'm amazed it notched 5 good days in a row as the sell offs over the last few months have been pretty brutal and we tend to see a drop of roughly 2.7% for the index on a bad day and there have been many of them.
If I am correct with this then in the impending sell off it's important to keep an eye on what USD JPY and USD CHN are doing as these typically seem to tank in line with this index. It would also be a good idea to replicate this short position on the SPX500 and the US30 too although the Nasdaq seems to be the one that gives you the best % return.
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