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Big market benchmarks like the Dow Jones Industrials Average, the S&P 500, and the Nasdaq Composite all tend to go up together, even if they don't always move up at the same pace.
But when markets go down, especially if they go down hard, they all tend to lose at similar rates.
So the secret to being defensive – or profiting from any market plunge – is knowing what's driving the markets and where the important support levels are in benchmark stocks and indexes.
Naturally, as stocks approach those levels, it's a good idea to start setting up your defenses.
That way, if they break those levels, you're free to parlay a potentially ugly downside move into some beautiful profits.
I'm going to show you what the big fish (the institutional investors and trading desks) are keying on now – and what important levels they're watching.
Because if these break, things will get very rough indeed…
About the Author
Shah Gilani boasts a financial pedigree unlike any other. He ran his first hedge fund in 1982 from his seat on the floor of the Chicago Board of Options Exchange. When options on the Standard & Poor's 100 began trading on March 11, 1983, Shah worked in "the pit" as a market maker.
The work he did laid the foundation for what would later become the VIX - to this day one of the most widely used indicators worldwide. After leaving Chicago to run the futures and options division of the British banking giant Lloyd's TSB, Shah moved up to Roosevelt & Cross Inc., an old-line New York boutique firm. There he originated and ran a packaged fixed-income trading desk, and established that company's "listed" and OTC trading desks.
Shah founded a second hedge fund in 1999, which he ran until 2003.
Shah's vast network of contacts includes the biggest players on Wall Street and in international finance. These contacts give him the real story - when others only get what the investment banks want them to see.
Today, as editor of Hyperdrive Portfolio, Shah presents his legion of subscribers with massive profit opportunities that result from paradigm shifts in the way we work, play, and live.
Shah is a frequent guest on CNBC, Forbes, and MarketWatch, and you can catch him every week on Fox Business's Varney & Co.
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