The next decision was to buy SSO with the hope that lower rates should boost equities, which worked well for about 30 minutes, until Yellen started speaking. The reversal was violent and I decided to liquidate the position at a tiny loss before it becomes unmanageable.
I also opened a new TBT short that started to work as Treasuries had been oversold in the past days.
The trade ideas for today are below. Mostly shorts here because the market is still slightly overbought.
I want to point the FAS short trade.
Based on data of two days ago (close of 9/16), FAS was good to short on a "Breakdown on volume", which is what happened yesterday.
As you can see below, $26.9 could have been a good entry yesterday.
If you run the data today, you can see that a bounce back to $26.9 does not produce good stats.
The reason for this is simple: the data below does not consider that on the previous day, we had a breakdown on volume. In other words, a bounce to $26.9 is a good short entry point.
On the other hand, we can see below that based on the latest data, the stats for shorting a strong Overbought situation back to the top of the envelope should produce good returns.