Keep it Simple…

On July 15, 1970, my first day as a cattle trader on the Chicago Mercantile Exchange, my mentor said to me, keep it simple, the market only has three choices, up, down, or sideways, so anytime you feel overwhelmed, back off to the simple.

It is so easy to increase the complexity of the formula, like adding timeframe, are you thinking about one minute, one day, one week, one month, or one year. And then add magnitude, one percent, 2 percent, or 10 percent.

Then answer the question, is this based on your intuition or is it data, a chart line or something you heard or read.

Obviously, it is not difficult to bring confusion into a market decision.

Applying all that to today, subsequent concepts in our posts of Monday and earlier today.

1. The April 7th low looks to be formidable.
2. Market participants are timid at best, generally look at current market as a dead cat bounce.
3. Trump and Bessent are looking into things and are trying to say positive things.
4. As mentioned earlier today the monetary market drivers are positive and will tend to rule the action.
5. Technically the SPX range of the 4835 low and the 5513-breakout point provides a 5174-swing point, the current market is above that level.
6. The 50 day average on SPX is way up at 5672, so is not relevant at this point.
7. Until either the S&P closes above 5513 or the trend of the 50-day average price turns up, we will be trapped in kind of a no man’s land in terms of general activity.
8. Bottom line, keeping it simple, it would seem that buying selloffs, not rally’s, is as about as good as it gets for now.
9. Using 30-minute bars for short-term trading has relevance, and using RSI levels in the 70.0 area as short term sell out points would seem ok.