Two bullish scenarios and one bearish one
- Posted by admin
- on August 1st, 2011
1. We hold today’s low and distance ourselves ASAP from the trend-line test (currently at $SPY 128.1)
2. We break the trend-line, hit stops, reset, and bounce on the weekly 200SMA at 126.5
And the bearish scenario is to base on the trend-line, break down, and for the first time in 2 years, not bounce as the dip-buyer mentality finally changes. Then we’d have to deal with the first important technical break-down of the year on the March 2009 trend-line failure.
We perform better in bull markets and thus are rooting for #1 or #2, however considering how close we are to a major inflection point we’ll be looking to have a plan in action also for #3. We scalped the $SPY today for some dinky profits (i.e. small) and are happy to be on sidelines in this news tape. Next time we’ll get involved is on any reversal of 126.5 or pay up for a bounce on any stocks that set-up long.
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- Make peace with not catching every move
- 21 days and counting
- Trade against it
- What’s your edge?
- Wait for it
- Keep Calm and Carry On
- Even if you don’t trade it, you have to watch it
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- No matter what your time-frame, be patient enough to trade against an edge