Quite a move today. The Nasdaq Composite Index gave up it's 200-MA, engulfing the price of the past 3 sessions.The SPY gapped up above R1 and consolidated in a tight and narrow channel for the first 15-minutes before falling apart. Profit taking seemed to be the theme between pivot and S1. Once pivot put up resistance a test of S1 again triggered more momentum to the downside.The 15-min chart showed us a shooting star nr7 on ever-so-slightly lower momentum than the previous open. Initial support occurred at the 50-EMA (which coincided with S1 on the 5-min chart), while the 20-EMA acted as resistance. A "First Cross" short trigger came midday (Red vertical line). The 20- & 50-EMA's have crossed to a bearish orientation, however, price has not liked this positioning within this counter-trend. Also, the day's bottoming process displayed a bullish divergence.
Who knows what this profit-taking will turn into. Does the S&P shrug off this move and make it's own move the the 200-MA?XLV showed relative strength against today's market.
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
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