AMEX:SPY   SPDR S&P 500
245 2 4
Monthly Chart. "Follow Price off the DOJI . Note the Doji - Hammer & fall through Fast B.B. (Yellow) in '07.
The distance from "Mean" is my concern. As are Price, Pattern & time. Doji is just another Doji until it confirms. I get that!Cheers.
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There were a few Doji's in that run that were violated, or broke to the upside....what I do like about this one is the distance to the 100 ema..and would be even further from the 200 ma. That correction to the mean, to the ema's is in order. Probably the 09 correction was to the 200 and beyond. Imagine a rubber band on the price..and it's secured to the the 100ema and more likely the 200 ma...and the tension that occurs when moving away from the 200 ma. that must be resolved at some point by returning to the 100/200. As a short bias trader I'm always looking for that. It will show up first, usually in the high flyer, high beta stocks, then when enough momentum is reached it will pull their sector indexes and they roll over. If you overlay a few high beta index or stocks over this, and a few high flyers that are the furthest away from the 200 ma...when they roll over and a momentum tipping point is reached...this will roll over. A doji is an inflection point of indecision, balance...and will be probed by traders...in both directions for weakness/strength..and will be pushed by strength in the direction of weakness so the price spikes and vol is critical to see where it will go. The high flyers run first..then their sector indexes then the larger indexes like qqq spy etc. Dojis further away from the 200 have the added energy or pressure of the reversion to the mean. When they get this far above the 200 I start salivating as a short bias trader. I love a good run to the upside like to 07...because it makes for a faster harder drop eventually 07-09. This last bull rull unfortunately for many who came to trading since 09 will have experieced basically only a bull market, and will probably have a bull bias. Observe/adapt/grow change evolve
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