I am weighing liquidating trading account this morning and taking rest of the year off (THIS IS NOT INVESTMENT ADVICE)
I sold my SPY trades on that spike, I am going to keep the following longs for now KO, JPM, LMT, MSFT, PEP, KO, JNJ, IWM, and VZ. Don't expect to trade much at all unless I see a real juicy setup. I expected a rally this week but I'm surprised how fast people caught offsides are pouring in. Volume will drop off now over 3500, lots of different points the market will try to defend during consolidation. We are moving too fast here from too low to get through to new highs and hold them without consolidation.
Just spit balling what I'm seeing, there is a set up through Nov for us to establish this 3500s as the new range and then see if a Christmas rally can push it to 3700. I have some doubt on this being successful in the short term because we have a many year channel that traps us. The slope of that trend gives room to about 3650 by year end and 4000 by 2021 YE. Channels aren't gospel, they are resistance, if we are going to have a 15-20% return next year we have to escape this channel and establish a new one for the second leg of this secular bull market. The over stimulation, fiscal and monetary, may be the necessary ingredients for this to happen. If it does PEs will grow to nosebleed levels and it will be even more like bizarro world than what we have seen so far. The market expansion and subsequent inflation will require the Fed to finally step in and choke it to death.