Check out the following chart of the daily Nasdaq Composite Index, we made a new low today on a closing basis.
On the chart I have marked 3-day time cycles at the bottom of price, starting September 29th when we had our widest range down day and fell through support. Since that time every third day was a wide range day that was either a new low or closed on it's low with a large range (October 2, 7, 10, 15). Pretty coincidental huh? This past Monday would have marked another 3-day cycle, but price instead rallied. Perhaps we're transitioning to a 6-day cycle? Which just tells us that it's taking more time to have these wash-out sell-offs, which in turn could mean the downward trend is slowing down. We'll see how things turn out tomorrow.
Notice also that the 10-MA is resisting upward price movement.
The setups I include on this blog are used in conjunction with the 3/10macd and the criteria I ascribe to it as a way to alert me to an existing condition of price. The key concept to take away from this blog is that I try to anticipate what will happen on the higher time frame by using a faster time frame to trigger the trade setup. I do not trade a "system" I use two indicators to clue me in to price conditions. Please read the Disclaimer located in the sidebar of this site. I can be contacted via email at firstname.lastname@example.org
I am always open to questions, comments, or suggestions on how to improve this blog.