Inflection, Revisited
Continuing with yesterday’s discussion on alert zones, Nvidia
(
NVDA |
Quote |
Chart |
News |
PowerRating) gives
a very clear example of why they are important and how they work to tip off
potential reversals.
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11:35:51
Nvidia (NVDA)
is pulling back to an area near the 50% retracement of one leg higher and the
38.2% retracement of another. Note the previous bounce near this level on
April 26. NVDA is currently down 1.90 to 76.24 and is holding a three-month
relative strength rating of 95 from TradingMarkets.com.
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For those of you who were not with us yesterday, this is the
chart and the text in the post in the Insights From
The War Room, as this is potentially a key inflection point for
the stock. We were anticipating a bounce near this area, but we are also keying
in on this stock because if it fails from here, it is also a signal that
something is wrong and a shorting opportunity could exhibit itself.
We got the bounce we are looking for in today’s trading, and for
the intraday player, three opportunities have played out as of 1:30 p.m. Eastern.
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Daytraders saw the stock trade above yesterday’s high on the
opening bar, then pull back. Since the pullback was a continuation of yesterday’s
five-minute chart (if you put the two days together you will see this) traders
could have found the first entry there. A second possibility was the Opening
Reversal/Trap Door on the 10:00 a.m. bar as it took out the open. Even Johnny-come-latelys
could have gotten in the act out of a later Slim Jim (which was profiled in the Insights
From The War Room today) which gained a little more than 1 point
on the breakout.
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And what about the swing traders? They have enjoyed a 3-point-plus gain, and are thinking of retesting the prior swing high.
This is just one example of the many aspects of the market our
team of analysts are looking for, and how both day and swing traders can benefit
by utilization of the TradersWire and
Insights From The War Room.
Until tomorrow,
Duke
Gary
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