Trading System Signals on 03/06/2025

The V-Reversal long was the trade of the day, hitting its profit target in 5 minutes. The day started with nice gains on the longs. As the markets rolled over, some gains were given back but were re-captured for a small gain on the short side and were slightly above breakeven in the Sibilance NQ.

Last November before the election the December 2024 Nasdaq futures kept testing 20,000 intra-day, (I believe about 8 times) before the rally. We anticipated the market would trade down through the 20,000 level on the December Nasdaq futures before it rallied. It never did trade through those levels until today. Today, the pre-election levels have been taken out in the Nasdaq ($COMPX) and Nasdaq 100 ($NDX) equity indexes, as well as their 200 day moving averages. The S&P 500 is about 40 points above its pre-election lows and about 8 points above its 200 day moving average.

Today, the March 2025 Nasdaq futures supported 20,000, make a low 20,003.00 and is about 170 points above those levels in the night session (we know the market can move 170 point in a few minutes). The pre-election low on the March 2025 Nasdaq futures was 20,294.

We haven't seen panic selling or a "wash out" trade with margin calls in a while, which are part of normal market cycles. Without new stimulus, it is unclear how long existing liquidity might continue to prop up the market. The constant bounces seem to delay the inevitable as the afternoon prop and chop was clear on the chart. We joke that, "some days the market isn't allowed to go any lower".

Its been a slow choppy pullback. Imagine if it continued at the same pace and pattern another 20% lower. Will the market change its mode and rally here or accelerate the pace of selling?

The One Million MNS/250K Portfolio was slightly over breakeven trading Sibilance NQ. The daily charts have a nice down trend but the intra-day charts include an extreme amount of back and forth. Using a portfolio level trading approach that locks in gains early or uses a profit target can have larger drawdowns and less profit. This is counter-intuitive to our natural thinking.

The Stock Index Portfolio 10 hypothetical results were +$1,400 per Emini with 1/10th on Micros.

The 50K Portfolio hypothetical results were +$4,795.

The NQ Two System Portfolio hypothetical were +$1,975.

The NQ Five System Portfolio hypothetical was +$4,875.

Tomorrow is Jobs Friday and Fridays are one of our favorite trading days.