The stock market continues to sit at all-time highs, but I think that this rally is long in the tooth and traders will take off long positions going into the weekend. Yes, I look at the Triple Confirmation System and we see that the S&P 500 Futures are above the cloud on the daily, 2 day, 3 day and weekly chart, but I have major concern. The reason for this is because we had a long tail on top in the S&P 500 Futures about a month ago and this breakout to the upside looks very weak and we are not seeing support from the buying pressure.
Another thing I always look at is the Vix, otherwise known as CBOE’s Volatility Index and since the Vix can NOT break through $10 this makes me show that this rally is not here to stay. I could easily see the futures selling off 10 points between today and the end of the day tomorrow and this is why I look at the Nadex platform for the binary options.
There are a number of choices as all have trade offs but you have to decide how much you think the S&P 500 Futures can move lower between now and tomorrow as I look at the weekly binary options. If you sell the 2496.50 strike at 38, you're risking $62 to make $38 or another possibility if you really think the S&P 500 Futures could tank, then you could sell a lower strike, maybe the 2484.50 at 80, risking $20 to make $80. Lets see how today and tomorrow pans out, but I am looking for Bearish setups