So, this is the breakout...

Hardly inspiring, but a price breakout it was.  The Nasdaq edged itself above resistance, but it will need to do more to confirm.  There was a MACD trigger 'buy' to go with generally improved technicals - although On-Balance-Volume remains bearish. Today's candlestick was not exactly blowing it out of the water, but it did qualify as a breakout


Where things get a little sketchy is when we dig into some of the other indices.  The S&P didn't get to challenge resistance, but did finish with a dragonfly doji, typically, this is important during a swing low, but it has less relevance when it appears as part of a trading range.


The Dow Jones wasn't so lucky, although it was looking alot worse off earlier in the day.  The 50-day MA looks key for support. 


The Russell 2000 ($IWM) finished with a bearish 'black' candlestick just below 50-day MA resistance. However, because this index is stuck in a trading range the significance of this potentially bearish candlestick is reduced.  On the plus side, there was a MACD trigger 'buy'. 


We need to be careful here.  There was a breakout, but it remains vulnerable to a 'bull trap'.  It will only take a close below resistance to confirm (for the Nasdaq).  But, a decent gain tomorrow (in the Nasdaq) would firm up the move and help drive demand for the S&P and Russell 2000.  

Get a 50% discount on my Roth IRA with a 14-day free trial. Use coupon code fallondpicks at Get My Trades to get the discount.

---

Follow Me on Twitter


Investments are held in a pension fund on a buy-and-hold strategy.

Popular posts from this blog

Round 2 for the bearish "black" candlestick in S&P and Nasdaq

Image
The Nasdaq started brightly but ended up closing below its open price, but above yesterday's close. The S&P did something similar, although the intraday range is narrower. These two setups are somewhat complicated by the new 'buy' triggers in On-Balance-Volume for both the Nasdaq and S&P. And the new MACD trigger 'buy' for the S&P. Price action is key, so I would expect the candlestick to trump the technical picture; watch for lower prices tomorrow.
Read more

Being "Right" but still losing...

Image
I'm trying the Topstep Trader Combine as a sampler to day trading and it's an interesting setup with minimal outlay costs to get started. I'm not a huge fan of their platform UI but everything else has been pretty good so far. Today was one of those days where I waiting (and waiting) for the profit taking to kick in, but by the time sellers made their appearance I had reached my loss limit for the day and so that, was that. You can see all of my whipsaw trades here. For the record, I only work off price action, looking at support/resistance and tells like rapid stop take outs, usually a good sign for a reversal.
Read more

Big bearish engulfing patterns as positive start negated

Image
It was a setting up to be a low key day, but come the afternoon, sellers pounced and drove markets down hard after doubts raised on future rate cuts. Fed news wasn't the key takeaway, but the loss of support was. The S&P was hardest hit, not because of the percentage loss, but because of the volatility relative to recent trading action. Today marked a clear breakdown of trendline support. It should be noted, the presence of the 50-day MA offers a point of defence but today's loss does not mean we will see a crash; a time-led consolidation seems more likely. Technically, the MACD accelerated its losses and there was a fresh 'sell' in On-Balance-Volume.
Read more

Archive

Show more