1-2-3 Cha Cha Cha
Knowing the price levels of the key volatility bands is important for
intraday traders. This tool will point out good trades via the index holders, or
at the very least will give you a heads up to which side of the market you wish
to be on.
Volatility Bands
Here are today’s
volatility band levels for the Nasdaq 100, S&P 500 and PHLX
Semiconductor Index:
Nasdaq 100 Index ( $NDX.X | Quote | Chart | News | PowerRating) |
Upper |
Lower |
|
1.0 |
1042 |
981 |
|
1.28 |
1050 |
973 |
|
1.5 |
1057 |
966 |
|
2.0 |
1072 |
951 |
S&P 500 Index ( $SPX.X | Quote | Chart | News | PowerRating) |
||
|
1.0 |
915 |
887 |
|
1.28 |
919 |
883 |
|
1.5 |
923 |
879 |
|
2.0 |
930 |
872 |
Semiconductor Index ( $SOX.X | Quote | Chart | News | PowerRating) |
||
| 1.0 |
401 |
372 |
| 1.28 |
405 |
368 |
| 1.5 | 408 | 365 |
| 2.0 | 416 | 357 |
Each morning, we post the bands for the Nasdaq 100, S&P 500 and the
Semiconductor Index. When price gets out to the 1.5 and 2.0 bands, the
likelihood of a reversal becomes greater and greater.
When the Haggerty 1-2-3 forms between the 1.5 and 2.0 bands at
923 and 930 after the meteoric rise on the open, this foretells the waterfall that ensues.
What makes this approach so great? The phenomenal risk-to-reward
ratio. A tight stop placed just above the high at Swingpoint
3 entails a very small risk in the event the pattern fails, yet gives the chance
of capturing large gains on sell-offs or rallies. If you are not using these in
your trading, perhaps it may be a tool that could work for you.
Until tomorrow,