Today's action had a complete sense. In the previous post I mentioned a channel structure , part of the flag pattern, that may serve as a bull trap (see the chart). The sellers broke that channel and that accelerated the downside move. It was a decent short setup. Then the price hit daily 20 EMA which attracted long term buyers. A nice bounce that recovered 50% of the RTH session. The second setup was long. Could've been a bear rally? Sure, but nevertheless, bear rallies are quite violent and lucrative for day time trading.
Today, the Apple saved the indices again. If not the Apple the downside move would've been much bigger. Out of the FAANG stocks only the AAPL was green all day long and had a decent gain.
What to expect:
1. There is a possibility that the buyers will make a move to retest the broken channel where the sellers will have an opportunity to resume selling.
2. If the sellers push harder the anticipated downside target is bottom of the box.
3. There is a GDP report coming. That may interrupt the market action short term. When the dust settles we should see the continuation to the expected target.
4. It is possible that today's long term buyers turn around the price and start pushing higher back to the recent highs. If todays low is not breached then we may see a bottom of the range much sooner than expected. Watch for FAANG stocks to get a clue of what is coming.
03/27/2019
Today, the Apple saved the indices again. If not the Apple the downside move would've been much bigger. Out of the FAANG stocks only the AAPL was green all day long and had a decent gain.
What to expect:
1. There is a possibility that the buyers will make a move to retest the broken channel where the sellers will have an opportunity to resume selling.
2. If the sellers push harder the anticipated downside target is bottom of the box.
3. There is a GDP report coming. That may interrupt the market action short term. When the dust settles we should see the continuation to the expected target.
4. It is possible that today's long term buyers turn around the price and start pushing higher back to the recent highs. If todays low is not breached then we may see a bottom of the range much sooner than expected. Watch for FAANG stocks to get a clue of what is coming.
03/27/2019