Live Trading System Signals on September 21, 2022 - Choppy FOMC Day


Yesterday we said we are hitting capitulation in regards to chop. Today was even choppier, although our losses were smaller than yesterday. The price action continues to be difficult in this market.


The 200K Portfolio was down -$4,720 and the 50K Portfolio was down -$1,100.


The S&P signals were actually positive on the day.


The market sold off on the hawkish FOMC statement. It then reversed and ran all the way to the highs of the week before rolling over in the direction of the original trend.


The vibrations in this market have been against us in a solid way the last 6 days since our last equity peak with 5 of the last 6 days being losing days. We are at a new worse case drawdown, managing risk, looking for a bounce.


We are near a "trade small or not at all" pause point.


After watching the price action over the past week, I find it difficult to even have a decent strategy idea to trade this type of market environment. Its also difficult to predict the mode of the market.


The individual strategies are not performing poorly in general. Many have made recent equity peaks while most are in a small drawdown. Counter trend and trend strategies are struggling at the same time in this market environment.


It continues to be the slowest choppiest bear market I have seen. Typically in bear markets we see more days that are easier to short. Choppiness and losing days are always part of the market, but the percentage of those has massively increased and seems to approach 100% from a day trade perspective. I still believe the Fed's balance sheet enables the market to levitate at much higher levels than it normally would. The Feds balance sheet comes out tomorrow.


We are certainly due for a solid trend in one direction or another. It doesn't mean we will get one.


For those waiting for a max drawdown to start or add contracts, this could be a good entry point.


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