As the SPY was trading near the Highs of the day the IWM, DIA, and Q's were all lagging. Price tested just beyond the intra-day high before selling away from resistance (similar to a 2-B top, but we didn't get a close above the previous high), giving us a double top
The fact that there was a previous level of support (from Friday and Monday), it is preferable to not buy into a breakout move like this. Rather, let price prove itself by breaking out and retesting, then look to enter. There was also the PDH which could have been suspect as a selling level. Also, the high TICK, though high, wasn't as strong as the previous levels earlier in the day.
Essentially, a confluence of reasons to sell this level, and for those who bought, a catalyst for prices to move lower as they sold their long positions.The SPY is certainly drawn to a specific level:
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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