21 days and counting
- Posted by admin
- on February 2nd, 2013
Our readers will recognize this chart — we caught on early to this pattern and have been posting it regularly to StockTwits. It represents the trend between standard deviation Dev 1 (upper black line) and Dev 2 (upper blue line). On Thursday the $SPY closed on Dev 1 — we tweeted to the bears that this is your chance. If you want it, you have to push now and break the trend. On Friday the bulls came out in full force and pushed off closing instead closer to Dev 2. Well done bulls, well done.
When you find a pattern this clean then you have to respect it– keep it simple. Swim with the current until it tells you otherwise.
The smartest thing bulls could do is to stay within Dev 1-2. Higher prices and a break of Dev 2 would likely bring in the faders and profit-taking. Don’t overthink this (and we have to remind ourselves of this every day)– if you want to go contra-trend, go for short scalps, or wait until we leave Dev 1-2.
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