So, it's been a rough few days in the markets. As the S&P charts below should indicate, there clearly are some support levels to keep an eye out for.
As there's no sense in prognosticating on what will happen, all we can do is be prepared for a variety of scenarios.
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So, there you have it..looks like the Mr Market might be done head faking and will attempt to take another run above channel resistance.
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The Dow, hit hard yesterday, retraced to the breakdown zone today. It should get interesting(safe word for choppy) in the next few days as resuming the uptrend might prove to be a difficult task considering that it just broke down from an extended channel.
That would be, as I've posted often in the past few days, around the 16,510 level. Now, as we closed above this level today, we'll probably see a test at some point tomorrow or in the next few days.
Btw, notice the immediate bullish green up candle that shot through that level right off the open..a kind of Bronx cheer to those who either gave up on Mr Bull or even worse, went short!
No one said it was an easy game. Especially if you don't have the right team on your side.
So, going forward, how might we profit off this pattern?
Well, for one, as the market dilly dallies around above & below this level, some of our favorite stocks might pull-back accordingly due to a bunch of contributing factors like short term impatience or perma-bears salivating over what no doubt are recently elevated levels.
But let's see what the market actually does and make sure to have our "trading processes" in order.
As per our prior Dow post, not surprisingly it rallied to take out the key short term resistance at 16,510..though on the 4th try.
So far today it looks like others are waiting to see if it holds or not.
So, as you can see on this 15min Dow chart, an interesting micro battle is taking place..pull up a seat as the longer it goes the more significance it's going to have
Sure, it's only a 15min chart of the Dow..But deep in the trenches of the often missed key battles is exactly that for yesterday's resistance at 16,510..Pull up to the table and grab a seat!
What can you say about this chart..which goes back around a month. Up, Up, Consolidation and now resume Up?.
As we don't put much credence into "predicting" what's going to happen, stop in during the week and we'll surely do our best to tell you what is happening :-)
The Stealthy Trader
An experienced trader with over 15+ years of markets experience utilizing proprietary filters and analysis tools to uncover low risk trading opportunities.