late selloff Thursday tries to fill GAP

late selloff Thursday

Thursday’s selloff created a second distribution with the late rally high at 2074 as potential resistance for Friday. Above that is the single print/spike base, bottom of upper distribution at 2077. Depending on Friday’s open that area could tell whether Thursday’s selling went low enough or is there more downside to come.

But Thursday’s low at 2065.25 was poor, with just one tick of excess and also exactly matching the low from April 18th, keeping the unfilled GAP at 2064/2058.50 in play.

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short term trend remains down

one timeframing lower

While the long term and intermediate term trends remain up, for the current short term down trend to change, Tuesday will have to see an end to one timeframing lower on the daily bars, accompanied by overlapping to higher or higher value. Otherwise the short term down trend remains intact with the unfilled gap area within range.

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liquidation break Thursday

weak long liquidation break

Liquidation break Thursday flushed out some of the weak longs. The question now is there more liquidation or will the market continue it’s uptrend?

Selling was absorbed a tick above last week’s 2081.75 high leaving a poor low. A further break could target the current trading range low at 2064, and the unfilled Gap at 2058.75.

Trading with acceptance above Thursday’s point of control at 2091 could pressure Thursday’s late short inventory to cover, once again targeting 2100, 2105 and beyond.

Friday is options expiration, option writers could try to hold the market in a tight range or the exact opposite could happen if they can’t – extreme volatility.

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