Thursday, October 23, 2014

Oct 23 - Still waiting for consolidation/ pullback

Once again, shorts get squeezed on the open.  We might get a retrace tomorrow based on reversal candles, 2nd day of afternoon weakness, and decent negative divergence.  We have sell signals on 30/60 frames but they have failed twice on this strong upmove.  With more fray the last 2 days, we might see a confirmation on the third signal.

If we bounce at 192.2 SPY and consolidate that would be very bullish going forward.  A break of it could mean a move lower.  If there is a down day with low volume and lack of speed, I will be interpreting that as a bullish situation.

Still a chance of going back down to retest lows, but today's gap up made that more remote.  Last night, we saw a massive squeeze in futures.  It was obvious that someone wants this market going up for now.

As of now, a slight edge to the bears tomorrow but the easier trade will be to go long on oversold timeframes if the drop is not heavy.




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