Sell This Retest

Morning All,

I want to keep this post really simple- right here, the high probability trade is to sell this retest of the breakdown level. 

I am working under the assumption that we have seen a climatic intermediate high in the SP500. We had the Double top pattern out of 1370 and clear price confirmation on bearish breadth and volume. There are so many other patterns across markets illustrating a meaningful high but I will not recount them all again here. Most importantly, price broke through meaningful support levels on increased momentum. Thus our highest probability trade is to sell the first retracement/pullback looking for a retest of Tuesday lows at a minimum (but I think we trade lower than that).  

Let me illustrate through the charts:

S&P500 60mins:

Price is now clearly trending down with a new momentum low in place. Thus, I am looking for a reversal out of those downward sloping moving averages, targeting the 1330 to 1335 support zone at a minimum.

I have also shown my count once more for this index. That back to back 4th wave flat was the key precursor to this whole sell off. Price has hit the first target of the 4th wave of minor degree, but given the momentum and other technicals, the deeper target of 1330 to 1335 is in play.

S&P500 15mins:

I have zoomed in on the key resistance areas here. We are now backtesting the 1350 to 1355 previous support area and this provides a great low risk short trade, stops above 1365. Note there is an outlier level at 1360 which is the 50% Fib retracement off the top. Any move above 1365 would invalidate my bearish stance and setup.





In sum, I am looking for this bounce to run out of steam in the 1350 to 1355 area. I have just re shorted a small position and will increase size if I see more confirmation. Keep following this move lower. Stops should be above 1365 i.e. the big strong down night.

Adding to my analysis is the AUD. Price is now also retesting the previous support area and provides a great low risk short setup.

AUD 60mins

Clearly we are in a 3rd wave lower on increased momentum. I have no idea if this 3rd wave low is even in. Irrespective, we have to look to get into this downtrend and this zone is a confluence of res areas that should contain price.

Australia is clearly impulsing to the downside. Yesterday we saw clear confirmation on the Daily chart that this multi month consolidation pattern has ended with back to back strong bearish closing candles. Not sure what else you need?

ASX200 Daily:

And I will also re show my count that I have maintained for a while. I believe we are now in the beginnings of a new trend lower that will re target the previous lows in the 3800 region and possibly lower. Obviously I don't want to get ahead of myself, but this is the forecast.

ASX200 Daily Count:
Successive lower highs in a multi month consolidation pattern. Clearly price has failed to break out. The path of last resistance is now down. Let the bulls pay.

So in the short term we are clearly oversold and coming into the low end of the recent range. However, my experience has taught me to not fight these strong down moves. This is where the real money is to be made. As we saw yesterday, price tried to rally all day only to be absolutely slapped with an hour to go, breaking through the intraday lows. This is not a vote of confidence.

The chart below merely shows potential targets or stopping points. The key to me is to follow the trend lower until we see a clear basing pattern or bullish divergences. None of these are in place yet.

SPI 60mins:
We are now coming into the low end of the recent range in the 4130 to 4140 area. However, this is clearly a 3rd wave move lower and thus picking bottoms right here is not wise for now.

My SPI day trading range: 4131 to 4165. Outlier levels 4100 and 4175/4180.

My SPI day trading plan: Obviously the tone of my post this morning sounds rather bearish. I am aware of this and perhaps this is indicative of how everyone else is feeling and indicative of a big bear trap. I will keep this in the back of my mind. We are indicated at 4160 early given the overnight bounce. This is right back into yesterdays breakdown area. Thus I will be looking to short fade early in the 4155/4160 area with stops in the mid 60s. If we fail to sell early, this opens up the potential for a retest of yesterdays highs at 4177/4180 where I will also short fade more aggressively. I will look to get out of shorts in the low 4140s and then 4131 (the 61.8 Fib retracement from the recent high to the last major swing low on 30th December 2011). I will potentially look for long trades in the low 30s IF I see some bullish 5min reversal candles. The key is to follow the trend at this stage. So many markets such as the Hang Seng and the Nikkei are trending lower in 3rd waves so no need to fight this for now .

SPI 5mins:
Sell a retest of the 4155/4160 level.

Yup, We Were There

And just like that, it all comes undone. I have been theorising for a long while that this market was in jeopardy with low momentum, weakening breadth, wedge like patterns everywhere and price challenging key resistance levels. Tops are a process. We never know the exact time they will play out and all we can do as traders is anticipate and wait for the market to confirm. That time is very much now. Its just amazing how quickly everything can be undone as the crowd gets caught on the wrong side. There is so much leverage in the system and this will swiftly unravel. I imagine it will not be long before all of this years gains are swiftly undone. That's what climatic patterns do. That's what happens when you generate a bubble.


My trading colleague said to me that you just have to make your year when you have conviction. True that. However, equally as a trader I realise that when everything looks awful and the crowd is fleeing straight out of a market high, its probably time to cover. And thus, I have covered the bulk of my short positions in the low 1340s overnight. There is still more downside but it has been a great few days and this is why I go early into key levels to get a free look. My initial entries and setups were all shown here:
http://swingtradersedge.blogspot.com.au/2012_03_01_archive.html AND
http://swingtradersedge.blogspot.com.au/2012/02/end-of-month.html

Emini S&P500 60mins:
This is the first major target I believe. Looking for 1330 to 1335. Outlier level at 1327 which is the 61.8 Fib retrace off the last major low.

SP500 Cash 60mins:
A potential bigger picture target comes in at 1300 to 1315. I believe this is the first major stop for this correction. When we get down there, we can evaluate how big or meaningful this correction really is.

SP500 Cash Daily:
The simplest of charts. I must have shown this chart a few hundred times over the past fortnight. Double top/res zone. Well it has played out and yesterdays strong candle is indicative of a significant turning point.

So in sum, I am looking for a bit more weakness in the next 24hrs down to 1330/1335. The S&P500 closed on its lows and made a new momentum low. Breadth was very bearish with almsot 2800 declining issues on the NYSE and easily a 90% down day. Thus, I expect some follow through at a minimum. However, for me this is not the time to be putting on new shorts but getting out into extreme weakness. I will be looking for rallies back into the moving averages and resistance levels around 1355/1360 to re-iniate once more.

AUD Futures 60mins:
This is the one market that has guided me very well. Clear spillover out of res, clear failed bounce into 1.08 and my Head and Shoulders top was triggered once 1.07 dropped. We are now in a clear 3rd wave down I believe with a new momentum low in place. Short rallies into res.

To Australia. Yesterday was a dream day for the bears once that 4250 level dropped. I stressed the importance of this level over and over again. I took a little screenshot at the end of the day of the 5min chart. Once we failed to break above 4250 early, it was a trend down day pure and simple with many chances to get into the new downtrend.

SPI 5mins 6th March

The bigger picture in Australia is equally as bearish.

ASX200 Daily:
That upward sloping trendline will be broken today. We have a lower high in place, and a clear breakdown through a multi month consolidation pattern is potentially playing out. The target is right down at 3850 but I don't want to get too ahead of myself just yet.

ASX Daily ii
No counts, just a simple consolidation pattern that will be broken today I believe.

SPI day trading range: 4110 to 4180. Outlier levels 4100 and 4180, 4200.

My SPI day trading plan: We are indicated at 4151 given the overnight move. This is a gap down of some 60pts. As per the chart below, we are now entering into previous lows at 4140 and 4110 which should provide some support initially. Thus, I will be very careful getting too bearish early. My plan is to wait for the morning range to be established. If we gap down and hold, I will look to short a bounce back into the 5min moving averages up at 4170 to 4180. If 4140s fail to hold, I will look to short at market targeting 4110. Down in the low 4100s I will be looking for long scalp trades with tight stops. Bottom line, in these kind of gap down days, don't let emotion get too you and be prepared for potential squeezes if we don't sell early.

SPI 15mins:

Thanks
Austin

Are We There Yet?

Morning All,

Bit of a misleading title for this mornings post. This market certainly feels tired and we are selling off from clear resistance levels. However, for now we lack the impulsiveness to the downside and thus I really don't know if this is the beginning of a bigger correction or just a minor pullback. I remain core short the Emini S&P500 from 1370s. Topping processes take time. I believe we are close looking across a number of markets. You just have to trade the setups in front of you for your specific market and soon I believe it will all align.

S&P500 Daily:
Hit the big double top level and we have seen a small pullback thus far. No clear reversal candle but no doubt, this market is in the slot zone.

Nasdaq 100 Daily:
A lot of headlines this morning given that APPLE was actually down overnight! More interestingly, we have the NASDAQ clipping the top end of its trend channel and last nights trading left a  Daily bearish reversal candle.

Interestingly, the Russell 2000 seems to be leading the pack and has broken down through a clear consolidation pattern on the 60mins. The DOW 60mins also appears to be building a clear rounded top pattern.

In Asia, yesterdays news of China cutting GDP forecasts certainly caused a little stir. The Hang Seng sold off quite sharply and is now testing the recent low end of the range at  21,000. The A=C high on the Daily is still very much intact. The Nikkei hit the 61.8 fib retrace from the Daily high at 9800 and has shown back to back reversal candles.  AUD broke through the 1.07 level and is looking increasingly impulsive to the downside. Amazingly, the ASX200 held in remarkably well. Certainly this 4250 level is being defended. We will be testing this level once again today. Does yesterdays relative strength mean that we have a genuine bid to our market and we will hold in?

Hang Seng Daily:

Nikkei Daily:

AUD 60mins:
My potential H+S pattern was triggered yesterday. Interestingly, momentum also made a new low confirming the move. Any retracements back into the short term downtrend or 1.07/1.0750 should be shorted. This still looks like a 3 wave move for now so some more subdivisions to the downside would be perfect.

My SPI day trading range: 4220 to 4270. Outlier levels 4200 and 4290/4300

My SPI day trading plan: We have the RBA interest rate decision at 2.30pm today. The market is looking for rates to remain on hold thus any surprise cut I imagine will be taken positively. If we see no early break of 4250, I believe trading will remain lacklustre until the decision. My plan today is to look to scalp long 4245/4250 early on with very tight stops. If we fail to hold I will short for a bigger swing breakdown trade targeting 4220 and more significantly 4200/4205. We have held 4250 for a number of days now and thus I believe it is only a matter of time before it drops but obviously I don't know when this will be. If we do hold in, there are a number of targets for any bounce to 4280 and then 4290. Keep trading that range. Keep on the lookout for the HSI open today as well as we will be testing key support at 21,000 early.

Interestingly, the mining stocks in particular look very weak. BHP and RIO are both well off their highs and the short term trend is very much down in these names. FMG put in a very bearish reversal candle yesterday so be on the lookout for more weakness there.

SPI 15mins:
If this 4250 level breaks, I anticipate a sharp C wave down to 4200 adn possibly lower.

Monday Plan

Morning All

Looking like a relatively quiet open first thing this morning in Asia. There is a headline that has just hit the wires which states: "ECB says Greek PSI participation may fall short". Currencies haven't moved on this but it is early in Asian trade and  the big boys are not around yet. I'm sure this whole week is going to be dominated by confusing and misleading headlines as we approach the PSI deadline which will play havoc with the algos.

The focus for me in Australia today will very much be on this 4245/4250 level in the SPI futures. We continue to under perform overseas markets and the attempted move above 4300 was swiftly beaten down. Despite a positive lead on Friday morning, we popped and drifted lower for the rest of the session. Quite simply, we have a great breakdown trade here if this 4250 level does break looking for a gap fill at 4200 and possibly lower.

SPI 15mins:

SPI 60mins:
Are we looking at a failed breakout and a possible Head and Shoulders building on the 60mins timeframe?

AUD 60mins:
AUD continues to respect the levels with precision. I showed a great low risk short setup on Friday night into the 1.08 level futures. AUD hit a high of 1.0799 and then sold off for the rest of the session. Also a clear climatic reversal pattern, a failed "test" or rally, and now we are testing supports once more. If 1.07 breaks, this should really begin a new trend lower.

My SPI day trading range: 4233 to 4290. Outlier levels 4220 and 4205.

My SPI day trading plan: As I state every Monday, it is something of a lottery trying to call where we are going to open first thing. Fridays SYCOMM session indicates us at 4262 but no doubt we will deviate a small bit from this. I anticipate a retest of 4250 at a minimum. Quite simply, I will continue to buy 4245/4250 with very tight stops for scalps trades only. If we fail to bounce meaningfully from here, I will be very quick to look for the breakdown targeting 4230 initially and then as far down as 4200 (I doubt we see that today). This is the trade where the money will be made I believe. On the upside, Fridays highs at 4290 will be a great short fade level with stops above 4300. All action in the middle of this range is noise so pay heed to the price action and candles.

Thanks
Austin

Friday Plan

Morning All,

Well I'm pleased I covered something! Excuse me if I sound a bit cynical this morning but I just fancy a good old fashioned rant. Yesterday was actually one of the best trading days I have had in a long while so my frustration isn't born out of market losses. Perhaps missed opportunities. However, it's just that this market has become something of a joke to me. Just buy any dip. Just apply for a European banking license and get a 1 Trillion EUR handout or whatever it is to go punt on markets and tie up some loose ends. I doubt much of this money is actually being "lent" to businesses or for any other real purpose. Last night we had an ISM that missed big time, we had Oil exploding through the roof (just don't know how this is good for the economy) and what did stocks do? Yup, they went up. A good low liquidity melt up. Just to add to how farcical everything appears right now, the ISDA obviously came out and said that Greek debt "restructuring" certainly doesn't trigger a credit event and the bailout would not prompt payments on credit-default swaps. Of course. Why would it?

Breathe, breathe, relax.

Anyway, no new highs anywhere but probably only a matter of time. It makes me think that Thursdays sell off might just be a one day wonder.

 Yesterday I wrote (Emini S&P500):

"So for now, we have sold off into the first minor zone of supports. It is important to not get too ahead of oneself in these situations as the first dip in a uptrend usually gets bought. We have a number of supports coming in from 1350 to 1357. As per above, I have covered some of my shorts and will look to re-initiate on any bounces back up to 1370. I will hold a core position for sure given the initial confirmations and given the magnitude of this zone and because I am looking for a bigger swing lower from here. No doubt, I recognise that the lower risk play right here for short term traders is to look for buy setups into the uptrend with stops below 1350. All yours."

Ha "all yours". That certainly haunted me overnight. I have just re-iniatied more shorts back in this 70 zone looking for a possible double top trade but I will keep it real tight.

Emini S&P15mins:
That A=C move off the top proved to be the low. That first big dip always gets bought. Now looking for a retest of the previous highs at 1377 and failure. Otherwise, well its probably just going to keep going.

S&P500 5mins:
No new highs yet on the cash index. Looks like an overlapping mess for now.

DOW 5mins:
Interestingly, the DOW closed on its lows and did not get anywhere near to challenging its previous highs.

So all in all, I just don't know here. I think the best trade is to short a retest of that 1377 Emini high with tight stops but certainly the recovery off yesterdays lows was impressive. Furtheremore, given its end of the week, we will probably have to wait until tues of next week before a more meaningful sell off.

Perhaps its time for me to change markets and redirect my focus. One market that is actually respecting the technicals and trading within somekind of meaning is the Australian Dollar. On Thursday night we saw a sharp spillover from resistance and an impulsive looking move lower. In tandem with the bounce in stocks, AUD has rallied and is now challenging some great low risk short levels. This looks like a low risk fade to me in here with stops above Thursday nights highs.

AUD March futures 60mins:
That A=C long setup that I put up on the lows played out with precision and was the trade of the month. A rally all the way back up to the highs ensued. Now we have tested and clearly failed at resistance with a clear bearish reversal. Looking to now short the first retracement. Well here it is.

AUD March futures 15mins:
61.8 Fib retrace comes in here as well as the 1.08 level and previous failed breakout level. Should be a meaningful barrier and low risk short entry with stops above Thursdays highs.

To Australia. This is another market that has played out very well of late and I just need to keep the focus up here and not worry about whatelse is going on in the world.

My SPI range today: 4245 to 4290. Outlier levels 4300 and 4320. Outlier Supp 4230.

My SPI day trading plan: Given the overnight bounce, we are indicated at 4270 early. This market feels tired. We tried to breakout at the end of the month only to be firmly slapped down. Yesterdays bounce failed and we ended up closing right back on the lows. However, I recognise that the oil move overnight may give us a little added kicker today. More broadly, we are still stuck in a range from 4250 to 4300 and thus in the short term we must continue to trade around those zones. Thus, I will be looking to short fade a bounce to 4285/4290 with tight stops. Any move above 4300 opens up a retest of 4320 and would present a great low risk double top trade. Note yesterdays highs were 4275 and it looks like we may challenge this early so be wary if we fail straight up. On the downside, 4245/4250 remains solid. Buy it and sell it if it drops. I am keeping it that simple.

SPI March continous 60mins:

Thanks
Austin

Sometimes It Aligns

Morning All,

Yesterday was one of those magical moments which rarely ever materialise. Every setup I had on my screens played out, with market after market "testing" their previous highs and double top zones. Then it was a matter of pop and drop and we got it. I talked about these zones in yesterdays post: http://swingtradersedge.blogspot.com.au/2012/02/end-of-month.html. ASX200, HANG SENG, DAX, AUD and EUR- one by one these markets rallied into their previous highs and then failed, showing a significant reversal.

The Emini S&P500 popped to 1377 post the LTRO announcement and then sold off, gaining momentum to the close. On the 28th February I wrote:

"A ideal setup (Emini S&P500) would be a push above 1370 to 1375/1380 and then a sharp reversal back down below 1370. This would be a short signal for me".
http://swingtradersedge.blogspot.com.au/2012_02_28_archive.html

This is what we got yesterday and I added to my shorts in the mid 70s after the reversal.


Emini S&P500 60mins:
Major bearish reversal candle out of resistance. Clear failed breakout above 1370.

As per the chart above, last nights sell off now takes us into the first supports. One could even argue that this is a ABC type sell off from last nights high and thus a low is in. I have covered some of my shorts at 1360 BUT I do think there is a lot more under the hood for a deeper correction and thus I need to hold some shorts. Let me expand:

Last night volume was the best I have seen in ages with 1.1bln trading on the NYSE. Almost 800k of this was Declining volume. Advancing issues popped to 2100 on the open, making another lower high despite price making higher highs, and then reversed to close at 1018. This is bearish indeed. These are the exact breadth readings you want to see at major turning points.

And now for the price action.

SP500 Daily Cash:
Reversal Candle out of the Double top zone. Early days obviously but this is the first initial signs of confirmation.

SP500 Weekly:
I showed this chart to a colleague yesterday which once again emphasises the relevance of this 1370 level.

SP500 60mins:
And when we drop down a timeframe, I can see the final subdivisions of this impulse. I talked about the back to back Wave 4 patterns which implied one final push and I think we got that last night. Again, momentum is not following through to the upside despite price making a higher high. A convincing break below this 1365/1370 support would confirm a failed move higher and open up a move right back down to 1340 and possibly lower.

So for now, we have sold off into the first minor zone of supports. It is important to not get too ahead of oneself in these situations as the first dip in a uptrend usually gets bought. We have a number of supports coming in from 1350 to 1357. As per above, I have covered some of my shorts and will look to re-initiate on any bounces back up to 1370. I will hold a core position for sure given the initial confirmations and given the magnitude of this zone and because I am looking for a bigger swing lower from here. No doubt, I recognise that the lower risk play right here for short term traders is to look for buy setups into the uptrend with stops below 1350. All yours.


To Australia today. Yesterday I called for one more push up to the previous XJO cash highs as long as 4250 held, and we got this. The SPI popped through my 4300/4310 level before getting dumped into the close. Lots of month end shenanigans going on here no doubt. The 4250/4255 level will be key once again today and I can only call a new trend lower once/if this drops.

XJO 60mins:
Rallied right into the 4315/4320 target and then sold off into the close. No doubt a nice bit of month end window dressing going on here but don't worry, that stuff doesn't get investigated.

My SPI range today: 4250 to 4305. Outlier levels 4315/20 and 4230

MY SPI plan today: We are indicated at 4266 this morning given the reversal last night in the US. This takes us almost right back to yesterdays lows! I do think we have seen a short term high in the SPI and thus the highest probability trade is to look for shorts on a retest of 4295/4300 with tight stops. A move back up to 4315/4320 would be a more aggressive short. 4250 remains the key support level and I will be covering any shorts into here again and looking for scalp longs. If we cant bounce meaningfully out of 4250 then look for breakdown trades to 4230 and then ultimately 4200 in coming days.

SPI 15mins:
Pop above 4300 and then reversal. A break below 4250 would confirm a more meaningful high.

End of the Month

Morning All,

I don't want to go into too much detail regarding US markets in this mornings post. I see no reason to change my current view and setups which were all illustrated yesterday: http://swingtradersedge.blogspot.com.au/2012/02/looking-for-short.html. Seeing headlines of "DOW 13k, whats next?" does nothing but add to my grizzly outlook at this juncture.

I scaled into shorts in the Emini S&P500 last night with an average around 1370. We did see a initial fall given headlines coming out of Europe but this proved to be short lived. I have no idea if this will reverse or where it will top, and I will only add once I see clear bearish confirmation. For now I want to be positioned small as I just cant miss out on this opportunity. For now stops are above 1380.

For what its worth, I do think we will see a little bit more upside in the next 24hrs. A number of global indicies look like they want to and need to "retest" previous highs before any new impulse down can begin. We also have the LTRO announcement at 10.15GMT and this very well could prove a catalyst to the upside for this algo headline driven market. Shock and Awe have proved to be the name of the game from global central banks so why stop now? I believe EUR400-500 is expected by the market so watch out for a number in excess of that. I believe any strong pop would set up ideal conditions for a climatic bearish reversal.

As per above, a number of markets look set for a retest of their previous highs. If they get there, this would set up great Double Top short trades. This is how trends change:

DAX 15mins:

Hang Seng 15mins:

AUD futures 60mins:

To Australia. Yesterdays SPI plan and range played out very well indeed. I said:

"I think the strongest play is to short early into 4275/4280. If we fail to sell off from here early, then I could see the market rallying all the way to 4300 and possibly 4310. Thus, I will be short fading 4275/80 with tight stops and looking to cover in the 4250s".

4281 proved to be the top and we made a low at 4250. That 4250 level continues to be defended. To me, very simply you have to get short when that level breaks but for now, we are still very much in a range. Given what I have said above, I would not be surprised if we actually popped today and made a challenge for the previous highs and above. Its a tough call here as the cash market never hit those previous highs and we cannot rule out one more push.

XJO 60mins:

Fell short of the ideal target area. Will we try and make one final push into those levels at 4315? It could be argued that the current lower high is bearish and indicative of a truncated high.

XJO 15mins:

Key support zone held yesterday (4250 SPI). Thus, this does setup the potential for one final push higher as per the count below as long as 4250 SPI/ 4255 XJO holds.

My SPI Range: 4250 to 4300. Outlier levels 4230/4233 and 4310. This implies that the 4250 does not break. If it does, don't hang around.

My SPI day trading plan: Very simply, if 4250 breaks, I will be getting short looking for a bigger move down to 4230 then 4200. However, until that time I will remain open minded with the possibility for a push all the way back up to 4300 (unlikely today). I think the most probable play is a rangebound type day until we hear more out of Europe. Thus, I will be looking to buy 4250/55 with very tight stops and short fading 4265 and then 4280 with tight stops also. Breaks of 4280 open up a push to 4300/4310 and I will be getting long to join a retest of the XJO cash highs.

Thanks

Austin

SPI March 5mins:

Looking For The Short

Morning All,

There was a solid bounce off the lows in the US markets overnight which led to new highs across the majors.....just. I believe this now sets up for a perfect short trade in the next 24hours. Yesterday I wrote:

"A ideal setup (Emini S&P500) would be a push above 1370 to 1375/1380 and then a sharp reversal back down below 1370. This would be a short signal for me".

I believe this trade is now very much on track. Once again, despite the higher high, underlying advancing issues made a lower high coming at at 1600 vs 1800 on the 24th and 2174 on the 23rd. What I find very interesting is the back to back 4th wave type patterns i.e. Flats. Ultimately this implies that we are in the final throws of this impulse.

S&P500 15mins cash:

S&P500 Daily:
Right into the previous highs and the Double Top zone. Have to be anticipating a climatic reversal here.

S&P500 60mins:
There are clear momentum divergences going on into this clear 1370 resistance level. Furthermore, I can count an almost complete 5 wave advance into this recent high. Nice channelling, nice alts between 2 and 4, 3rd wave the strongest etc etc. Its all there.

The NASDAQ 100 looks tired at this 2600 level. The DOW Industrial is grinding higher and not impulsing in a clear wedge/overlapping type pattern. All in all, its setting up for me and now you just have to have a clear short signal/plan before pulling that trigger.

We are also seeing clear confirmation from Asian indicies. These are often the first to turn and are a lead indicator I have found. Yesterday the Shanghai A shares had a very significant reversal out of 2600. This is a clear climatic turning point to me and I see a decent pullback over the next week or so at a minimum. The Hang Seng is still grinding lower after making a high at the A=C target and 61.8 Fib retracement perfectly.

Shanghai A Shares Daily:

A shares 60mins:

Australia opened on its highs yesterday right into the sell zone, and trended lower for the rest of the session. .

XJO 5mins:

My SPI range today: 4250 to 4280. Outlier levels 4295 and 4300/4305.

My SPI day trading plan: Yesterday we trended lower for the whole day from high to low. Given the bounce in the Eminis overnight, we are indicated at 4270. Thus today is a question of whether we pop and drop to continue yesterdays trend, or are we going to have one more push into the highs? I really don't know the answer to this but I think the strongest play is to short early into 4275/4280. If we fail to sell off from here early, then I could see the market rallying all the way to 4300 and possibly 4310. Thus, I will be short fading 4275/80 with tight stops and looking to cover in the 4250s. Look to re-short if 4250s drop with a target down to 4220/4200 although very unlikely today. If we push above 4280, I will flip to long trades targeting 4300/4305

SPI 15mins Bearish Chart:
Target hit with a clear spillover and reversal. Breaks of 4250 will flip this trend to down and open up a genuine move lower.

XJO 60mins Bullish chart:
The XJO never quite made a new high. I could possibly label yesterdays move a C wave as part of a flat. We had something similar in the S&P500 overnight. This implies a retest and possbile break of 4315 before we begin a new downtrend. Thus if we dont sell early, be on the lookout for this.

Monday Plan

Morning All

I apologise but I am still having problems uploading my charts.

The S&P500 cash made a new high on Friday night and thus fulfilled my recent trade idea to buy in the low 50s looking for a retest of the recent high. Now it gets tricky. I think there is the potential for a pullback/reversal come Tuesday or Wednesday this week as once again this uptrend is running out of steam.

First of all, the S&P500 is now right at the 1370 target zone. No doubt I have gone early a few times but this is the nature of wide target zones. A ideal setup would be a push above 1370 to 1375/1380 and then a sharp reversal back down below 1370. This would be a short signal for me.

S&P500 Daily:

Despite price making new highs, breadth has really failed to follow through and shows some bearish divergences. For instance, NYSE closing advancing issues of late:

24th Feb: 1630 (closing Advancing issues)
23rd Feb: 2174
16th Feb: 2281
13th Feb: 2468

As u can see, despite price making new highs, underlying issues are just not confirming this recent push higher which is not healthy. Volume has also dropped off a cliff with only 640k on the NYSE on Friday which is the lowest reading I have seen for a while. Furthermore, we once again have clear momentum divergences on the lower time frames given Fridays test.

S&P500 cash 15mins:

I have often found Tuesdays to be my trend reversal days so I am on the lookout for climatic reversal candles out of the 1375/1380 zone in coming days.


Australia has now fulfilled the recent forecast I made for a retest of the highs also. Now things get very tricky indeed. We are at the top end of the range and thus some significant resistance. Furthermore, momentum is now clearly waning. However, the short term trend is up. Thus, I believe the smart play as a swing trader is to be getting out of longs and standing on the sidelines. I believe it will be very difficult for the market to breakout here without a consolidation pattern/range first. Thus I am looking for a climatic reversal pattern to short and if instead we get consolidation, I will look to join a breakout to the upside and focus on this uptrend once more.

XJO Daily:

Clear res zone here. Bull amrkets do climb a wall of worry but its tought to be long right here right now in the short term.

XJO 60mins:

My SPI range: 4250 to 4300. Outlier levels 4310 and 4350. .

My SPI day trading plan: It is always very difficult to give an accurate range on a Monday given the weekend influences. Furthermore, today we have a leadership vote at 10am which may have some influence on trade although I doubt it. Thus I think the best play is to wait and gauge the early price points. As per above, I think we are now at the top end of the range. I will be looking to short fade 4295/4300 with tight stops and looking to buy the solid support at 4250. Keep playing this range unless we see a clear breakout of either of these levels. I will join a break of 4300 SPI on the upside, which opens up XJO targets of 4335 and then 4350. Note the SPI March contract high is 4294 and thus if we do trade higher, reference those XJO levels instead.

SPI March 15mins:
Target hit and clear divergences for now.

Thanks
Austin