SPY - high probability rounded retest
The dump earlier today was an emotional one. This is apparent from the big red candles going from the 0.786 level to the 0.5 level in 7 hours. It's investors acting on fear.
This, combined with the bounce off of the support zone & the 0.5 level gives us a recipe for a quick recovery. Those who sold off realise they're wrong, buy back in. Those who sold the breakout are feeling the heat, buy back their position. Those who are taking profit on their short, buy back.
Our next big resistance is the 6 touch 0.784 level @ 3890. This is a great place to enter a short.
Now, our target will either be 3852 (forming a higher low), or knowing all the pending orders sat at 3808~/0.5 level have been filled, we can aim for the next level at 3775.
Stop loss will depend. It's really down to your discretion, but I'd be inclined to use a wider stop to avoid getting wicked out.
Let me know what you think and give me a follow for more.
Happy trading!
P.s. this isn't financial advice. I just like drawing lines on charts
This, combined with the bounce off of the support zone & the 0.5 level gives us a recipe for a quick recovery. Those who sold off realise they're wrong, buy back in. Those who sold the breakout are feeling the heat, buy back their position. Those who are taking profit on their short, buy back.
Our next big resistance is the 6 touch 0.784 level @ 3890. This is a great place to enter a short.
Now, our target will either be 3852 (forming a higher low), or knowing all the pending orders sat at 3808~/0.5 level have been filled, we can aim for the next level at 3775.
Stop loss will depend. It's really down to your discretion, but I'd be inclined to use a wider stop to avoid getting wicked out.
Let me know what you think and give me a follow for more.
Happy trading!
P.s. this isn't financial advice. I just like drawing lines on charts
Comment:
Idea didn't play out. 2 factors here: not enough time and space for orders to get placed at the 0.784 level + subsequent price action (a strong rejection would typically be expected).