The Shakedown 12/16/18

Surgeon's Market

Boy, oh boy, is it ugly out there! Bears cemented their control in the market this week capped off with an ugly distribution day Friday as S&P 500 fell 1.9% with Nasdaq dropping 2.3% as volume rose across the major indexes, bringing SPY's December count to -5.8%. We are continuously seeing us gap up in the morning, only to find major weakness in the afternoon. Trades from both the long and short side have been difficult. You have to be a surgeon out there to be killing this market. I went fully cash Friday and it felt great to not have any overnight risk in this market. I plan on being pretty selective going forward.

Cash is definitely the best position in these conditions, there are still quick trades you can take of course. It is wise to take most of your position off the table at 3:1 risk/reward in this climate, with selectivity being the name of the game. I doubt I'll look to take too many overnight positions until we start to see some better action out of the market.

(Click ^ for detailed look)

(Click ^ for detailed look)

A Few Bear Flags

EVRG Long