Tuesday 19 April 2011

Asian Morning Thoughts

Morning All,

The SPI is indicated at 4821 this morning after last nights sell off. Thus we are coming right into my support levels posted several days ago: http://swingtradersedge.blogspot.com/2011_04_12_archive.html. I have been stressing the importance of patience for postion traders and now I believe it is the time to consider buy setups in Australia once more. The key as ever is confirmation so look for hammers or somekind of bullish turnaround today/the next few days before going long.

SPI 60mins:
4800 is an open gap as well as the 38.2 retrace level

XJO Daily:
Todays sell off will bring price right back into the upward sloping moving averages.


Scenarios I am following today:
i) Gap strategy- wait for the first 15mins to trade and mark the highs and lows of the range. Buy a 5min closing candle above this range and short a 5min closing candle below this range
ii) Look for scalp longs out of 4800 with tight stops. This is a support play with tight risk. If 4800 breaks, look to potentially short and join the momentum lower for an intraday trade only

Bottom line, I think today could be a gap down, test of 4810/4805, and then a potential reversal day higher. The key is waiting for short term confirmation. I must stress the short term trend is down thus keep risk tight on the long side.

Thanks
Austin