The main barometer I use to measure to strength/weakness of the market and, therefore, the barometer I use to help me make individual stock trading decisions are the futures, particularly the S&P futures. This I previously explained in some detail. In fact, in this previous post I mentioned the futures were at a potential resistance point, which it broke through (providing a few long trades with measured profit targets). We have now reversed again.
Those who have been exposed to Crosshairs Training© received an email from me and knew to trade the market up through this broken resistance, careful to close long positions with a pre-set profit target, and then wait for the next consolidation or pullback to support areas. This has now become a reality. I was not right, I just anticipated its possibility! I do not take credit for it because I did not make it happen! I did not get the memo! That’s just the way the market is and the way I formulate my rules based on the indicators within THE CROSSHAIRS.
Let’s look at the chart now and you will see why I am all cash as I wait for the next opportunity, up or down.
Here are the scenarios:
1. A continued move up the 50 TANKS (PINK) as the trend continues from a consolidation area.
2. A sideways move from support (green lines) to resistance (red lines) areas. These areas are based on recent price levels and the current price located between the pink and brown lines (50 and 200 TANKS).
3. The beginning of a trend down in waves, just as the waves in the recent trend up, as long as the 50 TANKS becomes a place of moving average resistance.
I am not predicting anything here, just anticipating possible scenarios and waiting on THE CROSSHAIR to set up. When there is a CROSSHAIR I will be ready to trade the direction indicated.
Until then, I will most likely take my 7 year old to play golf.
