The rise on low August volumes was checked on Weds at the next weekly bullish reversal. After being rejected last week, price took the 25800 level during futures on Monday which indicated a rally was unfolding, so as stated I flipped long at 25840, which was the backtest of a daily pivot.
Price was rejected at the next reversal on weds which caused a fade until the last couple of hours on Friday. Next weeks pivots show the new monthly pivot lining up with WS2 at 25716, and the WR1 aligning with the bullish reversal at 26128. WP is at 26004 so we are opening very close to it, giving a neutral open. Both the mentioned areas should act as magnets and the reaction should be telling.
Once again, be prepared to react to price- a rally and hold above the 26128 area is a sign of another rally unfolding and a long opportunity. A rejection is a great short opportunity for a ride down to 25700 area initially. I will be watching futures for an early indication. Obviously its the start of the month which is usually bullish and the forced buyers will once again be buying the highs, therefore an initial rally before a move lower into the week is my preference.
A note on strategy- weekly pivots have proven to be very effective at negotiating the choppiness of the market. WS2 and WR2 give high probability reversals for entries, or enable escapes on a backtest if price shoots through. I have also found that using futures figures in the daily pivot calcs is more effective for the DJI.
Price was rejected at the next reversal on weds which caused a fade until the last couple of hours on Friday. Next weeks pivots show the new monthly pivot lining up with WS2 at 25716, and the WR1 aligning with the bullish reversal at 26128. WP is at 26004 so we are opening very close to it, giving a neutral open. Both the mentioned areas should act as magnets and the reaction should be telling.
Once again, be prepared to react to price- a rally and hold above the 26128 area is a sign of another rally unfolding and a long opportunity. A rejection is a great short opportunity for a ride down to 25700 area initially. I will be watching futures for an early indication. Obviously its the start of the month which is usually bullish and the forced buyers will once again be buying the highs, therefore an initial rally before a move lower into the week is my preference.
A note on strategy- weekly pivots have proven to be very effective at negotiating the choppiness of the market. WS2 and WR2 give high probability reversals for entries, or enable escapes on a backtest if price shoots through. I have also found that using futures figures in the daily pivot calcs is more effective for the DJI.
