A very sloppy day today, one in which I'd prefer to step away from until a direction is determined. I mean, just look at the first hour of trading (the Q's sold off right into S1 (green line) with the wide and indecisive range.
Interestingly there was another "V" bottom (5-minute chart) in today's tape (Friday last week saw a similar pattern), where the selling culminated in a narrow range candle (of the previous 7 bars, NR7) followed by a gapping down doji, and then by a strong green bullish engulfing candle. The volume didn't seem to come into the move until we were above the opening range high, after which the volume came in and brought on a crazy gap-fill.On a longer-term basis we did seem to make a higher low today and a very marginal higher-high. This market is not going down (below $28.50 on the Q's, 8000 on the DJIA) without a fight.
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 email@example.com
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