“The Dow tried to break well above 18,250 but failed at top of channel,” I noted on May 26, 2015. “Unless we see a strong, sustainable break above 18,200, which I didn’t think was likely, we could dive about 300 points lower, testing prior triple bottom support around 17,750.”
Weeks later, we hit a low of 17,714 after that call above. The poor bulls continued to chase the markets higher not realizing what our technical pivot points were telling us.
Am I telling you this to show off?
Well… maybe a little.
But I’m updating this call because I recommended a buy on the Pro Shares Ultra Short Dow 30 (DXD) up to $21 and/or the DXD October 2015 21 call up to $1.50.
The DXD ran from about $20 to $21.
The DXD October 21 calls ran from a low of about $1.15 to a high of $1.55 in no time at all.
If you were in and out of this trade – featured here absolutely free – congratulations on that.
Is the latest move off 17,750 lows sustainable? Perhaps… But just for the immediate-term on some of the oversold technical indicators on this chart.
The underlying economy is still very weak. There’s really nothing to get excited about… well, expect for these last few trades.