MARKET COMMENTARY -Bullish behavior holds steady but the level near 3272 becomes very important for traders today as technical divergence shows. Pullbacks are buying zones for participants in the current environment. My suspicion is that Nasdaq traders want to peg 10,000 and Dow traders want to press 30,000. As I have said for over a week now —Healthy attention to support means the best thing for us as traders- engage long at the test of key VISIBLE support- and pay attention if prices fail those front lines of support. Complacency still abounds so dips might be deeper and spikes may be higher than expected at the first tests higher or break lower.
WEBINAR LINK IS IN THE PROTECTED AREA OF THE BLOG – Please login and scroll down for the link.
WEEKLY PRICE ACTION
Positive momentum holds us in a breakout pattern after a bounce from support. We closed last week above 3263 and currently sit above this new region near 3272. It is reasonable to assume that buyers will engage at support levels noted but continue to keep watch for lower highs or the failure to hold nearby lows to signal a change of direction. Fades into weekly support areas noted will give us good engagement regions for long action.
INTERESTING SNAPSHOT from Koyfin -a ten-day look back- reversion to the mean for outsized moves still a likely formation
COMMODITY & CURRENCY WATCH
Gold spiked into 1613 last week before fading into 1560 where traders struggle to recapture at this time. Traders positioning for volatility continue to drive price higher. The US dollar is above key support zone- 96.6 as traders continue to trade in dollars for euros in the current cycle- I anticipate a price test of 97.4 again (accomplished and failing for now). We are at a decision zone here, so we are in a wait state again before we position using the UUP or the FXE (representing the inverse of the dollar. WTI has reversed into deep support regions near 59.27. Support sits between 59.27 and 61.2. Resistance levels sit near 63.5 to 66.97
TRADING VIEW & ACTION PLAN
We had a wave of a reversion to the mean complete under a bullish price environment and that has us at new highs. Pullbacks will be buying opportunities but we are potentially looking at choppy markets as traders digest moves in a broader sideways formation. Broadly speaking, buyers still have an advantage above 3206- so deeper dips still make for bullish support entries. SIGNAL LIGHTS ARE GREEN-but watch those supports
The theme of INTRADAY motion is:
POSITIVE AS LONG AS WE HOLD ABOVE 3263ish today (with big spikes likely with shallow fades back into breakout)
CHOPPY BETWEEN 3254 AND 3272
NEGATIVE AS LONG AS WE HOLD BELOW 3247ish today (with sharp bounces failing and deep pullbacks holding)– choppy inside the range.
Follow short term trend and momentum signals while in the intraday trading environment and watch for weakness to develop away from your trade direction in order to leave. Please log in for the definitive levels of engagement today.
METASTOCK SWING SHORT – Complete and stopped out- very choppy environment if we are looking for engagement and hard stops
METASTOCK SWING LONG – No swing longs in play…intraday longs off support as negative divergence shows. Only deep dips into 3251-3247 recoveries will make for good long trades
Intraday LONG trading from support edges like the VWAP or solid moving averages will give you the least risk event for engaging.
Intraday SHORT trading from resistance edges like the old highs will give you the least risk event for engaging.
Follow the candle trend until candles stop breaking higher.
IF YOU HAVE THINKORSWIM, YOU CAN LOAD MY PRIMARY LEVELS EACH DAY FROM THIS LINK. Because levels change often, you’ll need to download these each day. I do not draw all secondary price levels on my charts-
NEW LINK FOR TODAY’S TRADING DATA EXCEL SPREADSHEET –
REMEMBER, WE ARE USING AGGRESSIVE ENTRIES IN THIS MARKET– If those levels have passed you, simply walk your targets up the levels noted on the spreadsheet as the next entry as long as trend prevails.
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