So far everything unfolding as expected (except for the the giant gap down at open)... Target remains gap fill around 277 at the .382 retrace on the previously mentioned bullish bat.
I still think we paint some kind of inverse H&S monday and tuesday as SPY tussles w/ the purple (21 day EMA) and orange (200 day MA) lines. There's now a small bearish bat painted today which suggests we get turned away around these levels to draw the right shoulder on Monday.
Today's action tells me the market can still handle bad news so unless we get some catastrophic event over the weekend the gap down and flush scenario is off the table for Monday.
I plan on unloading most long scalps as we near that yellow line... the 200 MA on the 15min TF has typically repelled price action to spur another leg down. If we get turned away here and don't challenge the top of the channel, expect lower lows. That would also be a great time to initiate some short positions.
I still think we paint some kind of inverse H&S monday and tuesday as SPY tussles w/ the purple (21 day EMA) and orange (200 day MA) lines. There's now a small bearish bat painted today which suggests we get turned away around these levels to draw the right shoulder on Monday.
Today's action tells me the market can still handle bad news so unless we get some catastrophic event over the weekend the gap down and flush scenario is off the table for Monday.
I plan on unloading most long scalps as we near that yellow line... the 200 MA on the 15min TF has typically repelled price action to spur another leg down. If we get turned away here and don't challenge the top of the channel, expect lower lows. That would also be a great time to initiate some short positions.
Comment:
By now most bears are probably salivating at the chance to short this pullback. The question is... where and when? I think we can get a good idea of that depending on intraday action on Monday. Note in this drawing the small bearish bat can also manifest as a bearish crab at the 277 level. Remember 277 is the bullish bat target. I believe bulls will challenge the purple line (21 day EMA) at some point in the next 2 days. Lean bullish if it follows the green path, bearish if it follows the red. Bottomline is, bulls have alotta work to do here to reverse the downtrend.
Comment:
Added a starter short position here w/ april puts... Might TP on a H&S pullback since it looks so bullish this morning. Sure looks like this thing will at least try for a double top before the month is over.
Comment:
Pretty safe short here at gap fill... bearish crab setup and if it pulls back at all, the highest it can get to challenge the downtrend is at about the same price. Low risk but close the position if it somehow miraculously breaks out of downtrend today.
