After collecting 64 points on last week’s short and 39 points on yesterday’s bounce, the past week has delivered over 5%. I was gradually getting more comfortable with our swing positions, and yesterday felt a lot like many past melt-ups that barely paused — let alone corrected on their ascent.
But, a little voice in the back of my head kept whispering “backtest.” Seeing that S&P 500 futures are off over 17 points, I’m glad I listened yesterday afternoon and booked profits from our long at 2120 rather than holding overnight.
This is exactly the sort of overnight move that has made swing trading so difficult. Big gains during the day often mean gaps down overnight. And, vice versa. It’s a by-product of the constant manipulation of currencies and futures which has expanded over the past 5 years.
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