Live Trading System Signals on 01/10/2025

The morning lows seem to have become a sacred support level in recent years. Over time there are cycles where the market's final move of the day extends to the lows and extends the range. That "normal" pattern is so rare since 2020 with all the added liquidity. This generates layers of price distortion over time that are continuously discounted by recency bias along with the additional liquidity in the system. Longer term all the layers of distortion can create an "air pocket" below the market that could generate more accelerated selling once certain price levels are hit. With less rates cuts "on the table" for 2025, we could see more of a two-sided market.

When I first started trading, "catching falling knives" was a bad way to trade and a trading axiom that traders respected. In 2009, when the Federal Reserve and US Treasury joined forces after the Great Financial Crisis, Quantitative Easing (QE) began. Since QE, "catching the falling knife" has become a more profitable way to trade. We have developed trading systems to take advantage of this while keeping legacy strategies based on the way free markets typically trade. If true price discovery once again, becomes more important than "a system in place that makes sure the market always goes up", catching falling knives may not work as well. Until then, we continue with the approach.

The One Million MNS was up 0.2% on the day while the 250K Portfolio was up +$400. The intra-day session after the Jobs Report was very spikey and choppy after the flash move lower in many markets at 8:30 am EST. The night time trend from 8pm CST to 7 am CST continues to be trendier while the day session remains extremely noisy.

The Stock Index Portfolio 24 hypothetical results were +$4,287.50 with the Micro results at about 1/10th of the results of the E-mini. The Micro Bitcoin strategies were +$2,745 for the E-mini version of the Stock Index Portfolio 24 (trading 10 Micro BTC).

The Top 50 Select Portfolio hypothetical results were -$1,587.50

The 50K Portfolio hypothetical results were -$2,075.00

Next week we get more of a normal, five-day trading week. The following week includes a Monday holiday and a Tuesday inauguration. It will be interesting to see if the market sells into the inauguration and then rallies again or if the market will bounce and rally next week until the inauguration and then sell off after the inauguration (sell on the news).

The stock indexes closed down on the month and on the year today. We aren't hearing "As goes January, so goes the year..." It's too early to tell as there is a lot more trading left this month.