What Happens If We Get A Strong Move Out Of The Gate Thursday
The rally is impressive, and I see many more smiling faces
and more joyful voices. Although the weekly time frame charts
have a slightly upward bias, we have to deal with the daily time frame that may
through a small wrench in this move up.
Below I have two charts to
focus on with the Semi HOLDRs
(
SMH |
Quote |
Chart |
News |
PowerRating)) and Nasdaq e-Mini
(
NQ03M |
Quote |
Chart |
News |
PowerRating).
Basically, if we get a strong move out of the gate in tomorrow’s session we
complete a Bearish Butterfly pattern on each chart against Fibonacci price
resistance levels. That action would suggest that at least a short term sell off
would develop. This fits hand and glove with the position of the $VIX at such
low levels.
One could trade these charts a
couple of different ways. First, play the short setups. Second, wait for the
sell off to develop and we can calculate Fibonacci price support and look to be
a buyer against Fibonacci parameters as they develop.
Either way: Buyer Beware (at
least for the short term)
Have a great night,