Two Powerful Reversal Strategies For Any Time Period Or Market

billion shares with the SPX
(
SPX |
Quote |
Chart |
News |
PowerRating) closing at 1233.87, +0.3%. This is right

in the 8 point closing range of the past five weeks, so the market action had

little meaning. The Dow was also +0.3% to 10,634,
(
QQQQ |
Quote |
Chart |
News |
PowerRating) +0.6% to 39.45 and

the Nasdaq
(
COMPQ |
Quote |
Chart |
News |
PowerRating) +0.5% to 2167. The volume ratio was neutral at 54 and

breadth was just +552 which was weak relative to the price increase on the major

indices. There has been a negative divergence in breadth the past month while

the SPX has advanced in price. In the sectors, the
(
SMH |
Quote |
Chart |
News |
PowerRating) rebounded from

Friday’s -1.8% day to +1.1% yesterday, leading the green sectors, followed by

the BKX, +0.8%. Energy declined again from the very overbought condition with

the
(
OIH |
Quote |
Chart |
News |
PowerRating) -1.1% and XLE -1.0%. Gold was also red, with the XAU -1.0% along

obvious SPX 1,2,3 HB long entry above 1228.26 which worked its way up to a

1236.24 intraday high, closing at 1233.87. The first change-of-direction bar was

below 1233.25, so traders banked 4.5 – 4.8 points on half or all of the trade.

If you kept half, you made another couple of points to the intraday high levels.

The
(
DIA |
Quote |
Chart |
News |
PowerRating) gave traders an earlier long entry with the RST entry above 105.84

which ran +0.8% from entry to a 106.67 intraday high. The DIA 1,2,3 HB entry was

above 105.95 on the 11:45 a.m. ET bar, while the RST entry put traders in by the

10:35 a.m. bar. The
(
SPY |
Quote |
Chart |
News |
PowerRating) did not give the same RST long entry because the

previous day’s 122.75 low was not taken out, while the DIA did take out the

previous day’s 105.80 low. Both of these powerful reversal strategies are

outlined in the “Trading with the Generals” seminar material and the “Sequence

liquidity is thin and the next eight weeks present an extremely high risk time

period. I have made that bet with delta neutral synthetic straddles, so any

surprise in either direction is just fine with me, but make no mistake, the