This chart tells me the S&P is set to decline

Charles Sachs has utilized S&P 100 for the past 14 years, both as a trader and an advisor. He uses 24 proprietary indicators in order to structure options strategies which can generate gains whether the market moves up, down or sideways.

As evidenced by the chart below, the S&P 100 index has been trading in a fairly narrow trading range for the past three weeks between the 587 and 595 levels.

As I am writing this article, the S&P 100 index is approaching the 595 resistance level. Accordingly, we would expect the S&P 100 index to decline in price and move back down towards the 587 support level.

For a point of reference, the anticipated 8 point decline on the S&P 100 index would be the equivalent of about a 160 point decline on the Dow Jones Industrial index.

When financial markets are in a trading range, as outlined in the chart above, traders have the opportunity to formulate strategies using the time deprecation characteristics of options to give them a mathematical advantage to profit. Traders should also use the extremes of the outlined trading range above to enter and exit their trades opportunistically

Using the aforementioned strategies, our recommendations have accrued over 127.14% in profits (excluding brokerage fees) since July 2004, without a single losing trade recommendation. We have achieved these results while financial markets have traded narrowly.

Bottom Line:

In the short-term, traders can look to execute short (or put) positions, or exit long positions, as the S&P 100 index is at the 595 resistance level of its current trading range. We would expect financial markets to sell off in price shortly.

Sincerely,
Charles Sachs
Chief Options Strategist
www.PatientTrader.com