Scum and Reversal
- Posted by admin
- on November 16th, 2011
Update: GS closed well under (bearish) and no reversal on MOS GDXJ. To top it off we closed right at bottom of triangle. As we posted last night, not enough risk/reward to get us swing, we’re all cash.
Three charts we’re watching closely for bullish confirmations are $GDXJ $MOS $GS. What do they all have in common? Possible break-down failures which would be bullish. Scum and reversal (go through the breakdown zone and then reverse higher) trap the bears and inspire the bulls. We need the closing price to make any kind of price-action judgement but keep these 3 on radar:
We wrote earlier today that $MOS was offering decent risk reward on 55 break-down reversal (was around 55.4 at the time) with stop at 55. A close near 56 would be bullish.
$GS 98 we posted last night we would be short but that a scum/reversal would make us bullish. The short worked for a point and now it’s hovering under 98. A close over 98 today or tomorrow could help bottom this financial. It trades heavy today (too heavy for us to go long) but keep on radar.
We posted this last night as action spot — look how it scummed the lower trend-line and then reversed to stall at higher trend-line. A move through the upper trend-line could get $GDXJ going and would be nice win for the bulls.
To inspire the bulls you need the closing price to have some distance away from the break-down zone. A close near the break-down point would not really yield any information/edge. Two hours to go until the close – keep these 3 on your radar when doing research tonight.
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