What To Do When Standard Chart Patterns Become Irrelevant
With the recent price consolidation around the 870-75 level on the S&Ps, it
certainly is setting the stage for a “slugfest” between buyers and sellers. The
possibility for volatility spikes intraday is now very high as news continually
breaks from the Middle East. This will present some great trading opportunities
fro HVT trades. Bear this in mind, on the
heels of major news, good or bad, the standard chart patterns/HVT setups that we all adhere to day to day
will become irrelevant. Granted these trades are sporadic, but do not get too
hung up on the particulars from a technical standpoint, emotions are driving
this market and emotions supercede chart patterns.
The daily chart above of the S&P futures clearly illustrates where we are
currently, right at the neckline of a Head-and-Shoulders formation, 870-75. The
level also coincides with a 50% retracement off the December high and the recent
low. The important thing in this market is to not get too hung up in calling
turning point. The best approach is to simply be aware of potential levels that
may offer turning points and then assess the trade at that time. Taking an
absolute stand at any level is tough in this market.
Purely from an intraday position standpoint, Apache
(
APA |
Quote |
Chart |
News |
PowerRating) looks nice on the short side. Keep an eye on the 60.55 level,
if that gives way and the S&Ps/Dow are also trending lower, there should be
some nice follow through to the downside.
| Support/Resistance Numbers for S&P and Nasdaq Futures |
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* indicates a level that is more significant
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