S&P Midweek Update 10/6/2020 - Trumps Tweet: Did it matter?
I usually only post one trade idea a week for the S&P, but this week's trade idea produced an excellent trade that I closed it and may look for another trade setup for the second half of this week. Check it out. It was a long trade setup out of a triangle wedge.
The market today (Tuesday - 10/6) had a violent reversal after it looked like it was melting up (hence why I closed my earlier trade and took profit; I hate melt-ups). The question of whether Trump's tweet about delaying stimulus really spooked the market, or if the market was planning for a technical correction doesn't really matter to me. The timing of the tweet and the market reversal was interesting though. I look at price action alone.
Some might not believe it, but the market structure still could have some upside based on a bullish uptrend channel it has formed over the last several trading sessions and has stayed inside even after today's dump.
As I've posted before, I DO NOT try to predict what the market will do. I look for a trade setup on the sell side and a trade setup on the buy side. This way I don't let my bias interfere with what the market hands me.
Here there is a large 'No Man's area' (the channel) and I will wait patiently for price to either break out of the channel to the upside or downside. The breakout and breakdown of this channel happen to correspond to strong support and resistance (isn't it funny how these things work out - there are no coincidences in the market).
Never play the breakout. Be patient. Wait for price to return to it's breakout area, retest it, and resume up (indicated by the arrows). Patience is rewarded by this market.
Good luck.
The market today (Tuesday - 10/6) had a violent reversal after it looked like it was melting up (hence why I closed my earlier trade and took profit; I hate melt-ups). The question of whether Trump's tweet about delaying stimulus really spooked the market, or if the market was planning for a technical correction doesn't really matter to me. The timing of the tweet and the market reversal was interesting though. I look at price action alone.
Some might not believe it, but the market structure still could have some upside based on a bullish uptrend channel it has formed over the last several trading sessions and has stayed inside even after today's dump.
As I've posted before, I DO NOT try to predict what the market will do. I look for a trade setup on the sell side and a trade setup on the buy side. This way I don't let my bias interfere with what the market hands me.
Here there is a large 'No Man's area' (the channel) and I will wait patiently for price to either break out of the channel to the upside or downside. The breakout and breakdown of this channel happen to correspond to strong support and resistance (isn't it funny how these things work out - there are no coincidences in the market).
Never play the breakout. Be patient. Wait for price to return to it's breakout area, retest it, and resume up (indicated by the arrows). Patience is rewarded by this market.
Good luck.