What in interesting two days in the market. Yesterday a huge selloff and then today the huge fed-induced rally. I thought we still had a fair amount of room to go to the downside up until a couple of hours ago, but now I believe it is time to be long hunting again. My reason: all four of the indexes put in pink extended range candles today, many of them engulfing too.
I’ve noticed that all too often trends start and end with a big blow-off pink extended range candle. The lows of today are important – above and I am long hunting, below and it is all bets off again.
I have been very bullish on the financials ($XLF) but the market is starting to look a little tired, and I think the financials will be dragged down too. I got short Goldman Sachs ($GS) today, and am looking for a selloff into next month. The next good looking daily demand is 173.27.
My entry is a somewhat tiny 15 minute zone, but to me this short term price action is telling. $GS failed at the highs earlier this weak, and is now starting to break down in my opinion.
I closed a bunch of trades today, and sit largely in cash, looking for tactical opportunities every day. Now is not a time to be loading up for the long term.
There are also a number of opportunities to get short in some other names, and I have resting orders to sell. These names include
Some great ideas, particularly for traders and parents.
Right now the Euro is stuck between demand at 1.32960 and supply at 1.35160. There really isn’t much to do at the moment as far as opening a new position goes. Overall it still looks like it wants to go lower to the demand at 1.32960.
Looking at the bigger picture, it is still in an uptrend, with the 50% retracement of the larger move coming in at 1.30200.
Patience is the name of the game at the moment, don’t get chopped up in the middle of nowhere.
This is going to be awesome!
This morning the market sold off after Yellen gave her little talk. I’m watching the Russell 2000 ($RUT) to get an indication of market direction and I think that we are done with this correction and are going to take a stab at the highs again. My reason is that we hit some 30 minute demand that lines up right with the 50% retracement of the total move up. It is a logical, clean retracement right at the 1,150 level.
If this level does not hold then all bets are off and I’ll be watching the 1,030 level for the next good looking demand.
So we’ve sold off for two days and I think the selling is done for now. The Russell 2000 ($IWM) is down 3.83% over the two days, which is a fairly large move. All of the indexes hit daily demand yesterday so I took the opportunity to get long in a number of names, namely
While we are in an uptrend, I am buying dips and I consider this a dip.
We have had a big run, so I am a little cautious and keeping a close watch on my positions, but a trend is a trend until the end.
Certainly something to think about, and something that I have been debating with myself for quite some time.