In this case, the sellers are likely to become majoritary again due the the following reasons :
- Proximity with the downside resistance
- Beginning of a retreat at 3100 points, first resistance
- This matches with the of the violent drop we have seen in december - february.
Both the long term dynamics and levels should prevent the buyers to go further and initiate a pull back to where markets were in september.
Here is the precise strategy :
- Open short at the current price (3080 points on Friday close)
- Stop @ 3120 pts (above the resistance for market noise)
- First target @ 3025 points (close 50% of the position, reward/risk = 1.38)
- Second target @ 2940 points (close the other 50% of the position, reward/risk = 3.5)
For those who want to lower their risk for the 50% position left, you can put the stop @ 3015 points (above the gap that just opened).