Tuesday, May 3, 2016
May 3 - Equities continue downward dribble, GLD/ GDX might be at a turning point
Equities continued the short term trend down today and I was looking for a late day ramp to go long around 3PM but it didn't materialize. Flat barring some FEYE calls. Wanted to hold the AAPL calls but was concerned about the overall market. Had we been in an uptrend I would have surely held.
Looking to fade a big gap up or go long on a test of lower support levels.
IWM looks strong but cracking the lower trendline will be a problem.
QQQ is in a confirmed downtrend and tapped a rising trendline multiple times already.
This is basically my playbook for tomorrow. Lots of possibilities which is why I would prefer to see the market play its hand first rather than getting potentially whipsawed.
This is a big reason that gave me caution. We should be blasting up into the next leg up but seem a bit stalled out and have negative divergence on the daily. Things might need to settle with time or price to set up the next move up which I will be more than happy to ride. Very possible that we pullback beyond the recent consolidation zone as failed second legs often correct hard.