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Russia's Nuclear Plant Attack Makes Case for Traders Moving to Cash Each Night

With a madman on the loose conducting a ludicrous war, this is a time for less risk, not more.
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Thursday night's after-hours trading session is an excellent example of why most traders shouldn't carry a lot of overnight risk in this environment.

Sometime around 7 p.m. ET, the minister of foreign affairs of Ukraine, Dmytro Kuleba, tweeted out:

"Russian army is firing from all sides upon the Zaporizhzhia nuclear plant, the largest nuclear power plant in Europe. Fire has already broken out. If it blows up, it will be 10 times larger than Chernobyl! Russians must IMMEDIATELY cease the fire, allow firefighters, establish a security zone!"

The statement by Kuleba, along with a report from the Associated Press that an unidentified Ukrainian government official was reporting elevated radiation levels near the plant, triggered a selling frenzy among overnight futures traders. Folks hammered the bid of anything related to risk, which meant equity futures spiraled lower while gold and oil spiked higher. Suffice it to say, this is why, as a retail trader and with a madman conducting a ludicrous war, it's OK to move to cash at the end of the trading day. If you aren't managing a large pool of assets, this is a time for less risk, not more.

Equity futures cut their losses and gold and oil gave up their gains once local authorities said the situation at the nuclear power plant was secure. The International Atomic Energy Agency also assured everyone that there was no change in radiation levels at the plant, which helped stabilize the overnight market. But still, last night's events surrounding the potential meltdown of the Zaporizhzhia plant are reason enough to tread carefully while the Russian army is trying to destroy the lives of the Ukrainians.

Moving on to Friday's trading session...

Both the SPDR S&P 500 ETF (SPY) and Invesco QQQ Trust (QQQ) were rejected from their 21-day exponential moving averages (EMA) on Thursday. And while both ETFs have mainly traded sideways since last Friday, their rejections from the 21-day EMA have me looking for additional selling.

For Friday, we'll monitor a 10-handle range on both ETFs. With the SPY's range being $438 to $428 and the QQQ's range being $348 to $338, we'll look to fade the edges on both.

At the time of publication, Byrne had no positions in the stocks mentioned.