S&P 'Bull Trap' Becomes A 'Bear Trap'
As this rally has often done, just as you expect a reversal to start, bulls come in (hard) to bid up the market. The S&P had the clearest switch as it moved from a 'bull trap' to a 'bear trap'. If it can post a break of 2,597 it will have little to stop it; in such a scenario watch for a fresh MACD 'buy' which would confirm recent losses as a pullback 'buy' opportunity. Stops on a loss of 2,557.
More impressive was the recovery in the Russell 2000. I'm not sure it has done enough to consume what will be plentiful supply all the way to 1,515. Despite the 1.5% gain there wasn't a significant improvement in technicals. There will not have been many longs to have taken a punt on the drift below the 50-day MA so much will depend on the strength of the short squeeze - today was a good start.
The Nasdaq didn't disappoint. It was the safest long trade and despite the morning gap it was able to post additional gains. Upper channel resistance remains the upside target. Today's volume registers as confirmed accumulation.
The Dow Jones only managed a weak bounce but the telegraphed 'buy' at support should have survived a stop test.
Today's action was a useful start. Key to tomorrow will be closing in the upper part of today's intraday range - irrespective of how much ground it gives up over the course of the day.
You've now read my opinion, next read Douglas' blog.
I trade a small account on eToro, and invest using Ameritrade. If you would like to join me on eToro, register through the banner link and search for "fallond".
If you are new to spread betting, here is a guide on position size based on eToro's system.
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Accepting KIVA gift certificates to help support the work on this blog. All certificates gifted are converted into loans for those who need the help more.
Follow Me on Twitter
Dr. Declan Fallon is a blogger who trades for fun on eToro and can be copied for free.
. I invest in my pension fund as a buy-and-hold.
More impressive was the recovery in the Russell 2000. I'm not sure it has done enough to consume what will be plentiful supply all the way to 1,515. Despite the 1.5% gain there wasn't a significant improvement in technicals. There will not have been many longs to have taken a punt on the drift below the 50-day MA so much will depend on the strength of the short squeeze - today was a good start.
The Nasdaq didn't disappoint. It was the safest long trade and despite the morning gap it was able to post additional gains. Upper channel resistance remains the upside target. Today's volume registers as confirmed accumulation.
The Dow Jones only managed a weak bounce but the telegraphed 'buy' at support should have survived a stop test.
Today's action was a useful start. Key to tomorrow will be closing in the upper part of today's intraday range - irrespective of how much ground it gives up over the course of the day.
You've now read my opinion, next read Douglas' blog.
I trade a small account on eToro, and invest using Ameritrade. If you would like to join me on eToro, register through the banner link and search for "fallond".
If you are new to spread betting, here is a guide on position size based on eToro's system.
---
Accepting KIVA gift certificates to help support the work on this blog. All certificates gifted are converted into loans for those who need the help more.
Follow Me on Twitter
Dr. Declan Fallon is a blogger who trades for fun on eToro and can be copied for free.
. I invest in my pension fund as a buy-and-hold.
