Dead Cat Bounce
I just took a glance at the E-Mini and it looks like we may be served a potential roll over scenario here. Yesterday I promised you realized volatility (RV) and we’re certainly getting a generous helping of that. I also gave both the bullish and bearish scenario pretty even odds based on [elaborate reasoning here]. Now this morning it’s becoming clear that yesterday’s meek advance will be unable to hold its meager gains.
Which by the way does not surprise me the least after looking at the magnitude of participation on our Zero indicator. Just compare Monday’s signal range during a bearish day to that of yesterday’s chop higher. Can anyone say ‘dead cat bounce’?
I was somewhat impressed by the fact that VWAP wasn’t touched once yesterday, which to be honest is quite uncharacteristic given the spasmodic advance higher. Maybe it was mostly bot driven OR it could be an indication of distribution, and you know what that means.
Well, you know the plan I already outlined yesterday. On a stop out I will observe the tape and wait for a last kiss goodbye (LKGB) retest of 2820. Should I get that then I’ll take out a short position with a stop > 2840.
That’ll be all for today as I have a ton of video editing to attend to. Plus I’m already spoiling you guys too much 😉