in another tight consolidation pretty much identical to the one highlighted below current price. The last one broke out to the upside and we got a nice retrace and bounce to where we are now. I remain neutral at this point until the breakout. The devil is in the details right. The lower zone gave us a good down day followed by two up days then another down day. The day prior to the actual breakout was a strong up day as well. Friday was a strong down day. Break out trades to me are difficult and risky. However considering the similarities of these two zones if Monday price opens near yesterday's close I think a long would be in order with a stop just below the zone. If, and this is all a big iff, that's why it's rightfully called speculation.....if History does actually repeat itself and we have twins the question instantly becomes where do we get out since there is no data above that we can see. For one there is some data above still on the Nasdaq and the DAX
also correlates well with the S&P
and it also has data above that can be used.
Having said all the above one could just as well remain neutral and just let the breakout take it's course then play the return to the breakout. If you look at the baby below it got a nice pullback. The one that got us way up here where we are expecting another baby.
Of course it could always break down for us as well. That story is somewhere in the red circle area if that is the case
One thing I do know is that if you want some egg on your face just start predicting directions for the markets. I firmly believe we can frequently pick turning zones from time to time when certain circumstances all align for us but even then it's always a gamble so even the very highest of odds bet requires a stop. A solid line where we say ok, I was wrong.