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Underlying:NAS100 Time frame:1D
The markets are at all time highs... but how much longer can it go?
Currently the NASDAQ is creating a very pretty looking wedge formation. There are two options as we all know, it will break down or break up (obviously). As this market has had so much strength will small moves I feel that people are getting over-confident. This over confidence is showing hte volatility index (VIX) too. The risk currently is to the downside and this is how I am playing the trade.
If we touch the top of this narrowing range, I will short it and wait for it to break below.. Please note it has been incredibly hard to short the markets.
The MACD and Price Osc have both have turned down in a trend line. The RSI though is still at 60 and the Momentum Index still shows the upside has got some legs. AGree with you that down is coming. I will watch the Momentum STCH closely. Good spot Social!!
SocialTrading
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@heinklee, watching carefull :) it has just crossed at the bottom... needs to get below the centre line.
heinklee
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@SocialTrading, Thanks will do. Going to watch this one closely. going to require some patience
RalphStPierre
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traders pyschology is exuberence at the extreme..i like your understanding of macd...one of the indies that can actually lead price if understood
SocialTrading
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@RalphStPierre, thank you! it is crazy how much we have rallied!
RalphStPierre
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@SocialTrading, it is...i fear tho..that even a healthy correction..into logical fib levels will cause hysteria(mass pyschology of a crash...leads me to another thought..is capitalizing on other peoples fear right..my bank account says its ok..lol) the declines always seem faster..some nice profits could be had
SocialTrading
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@RalphStPierre, yes! It seems so much easier just to buy and hold... Sadly it cannot work forever.