Today I expected one of two things. The more constructive thing (in terms of the markets moving up) did not happen. This scenario would have been a large gap down on high volume that would reverse mid day and close above the open. The VIX would gap up and put in a black reversal candle. That did not happen.
Instead, we got my second scenario. This involved a grinding movement up on light volume to retrace some of the big move from Monday. It basically was a slow motion short squeeze or traders taking advantage of the Jewish holiday to run the price up (and don't even get me started on how Congress can't skip one holiday to face one of the largest financial crises ever known to man).
So what do I expect? I expect more selling, and I expect to short. On SPY, I think that level may come up around the 5 day MA (the pink line on my SPY 10-min chart) which is now around 117.87. This is also near a 61.8% retracement from Friday's high and the bottom of the congestion area that the market traded in last week. It should serve as stiff resistance.
Today I took a long position in gold thinking that GLD would hold above $86. When it did not, I sold half of it. I will sell the rest if it moves under today's low. I use DGP for my gold trades. I looked at GDX as well (miners) but I am not happy with the price action yet. It broke short term resistance on the 10-minute chart but fell back below it and could not make it back up for a retest. If GDX can hold in this area for the MAs to flatten out, then maybe it stands a chance. Otherwise, the 10-min pattern resembles a descending triangle which is short-term bearish.
No comments:
Post a Comment