After today's trading day, I saw that we broke the most recent support level, leaving the bottom or June lows support level the next up line. This dosent mean that we have to test it, but I have had a strong feeling that the SPY was inevitably going down to this area. And I thought this because I've been paying close attention to the movements of the SPY in correlation to its RSI during these past months of high volatility since the November crash began. One thing that has not let up was its reliability in measuring overbought and oversold areas and their points of trend reversals. While using other oscillators like the DMI and ADX to confirm these trends, MACD, and MAs. Getting to the point right now that I'm pointing out is how CLOSE the SPY is to being Oversold once again, coming off of a strong overbought rally, transitioning into a falling oversold point, just as the patterns have played out similarly when this same senario happened before. Their is no telling if it will cross below 30, bounce off 30 or get near 30 before a reversal. So using the DMI and ADX together helps to measure the strength in the current trend. The ADX is non directional, it moves up as the trend is strong regardless if the trend is moving up or down and it goes down when the trend is weak. As the adx begins to change direction it is signaling an upcoming change in trend direction showing the weakness approaching that might not be noticeable in the candles yet. So I'm going to keep an eye on that incase the SPY confirms being oversold before hitting the 30, to be able to call a bottom. Experienced traders probably do not need to be seeing this, but hopefully someone might get some use out of it, or maybe you did not notice how close the main index is to being done ..being sold off..which is really good news. 👍
Comment:
look how well i called this short term bottiom