On The Verge

Equity futures are showing follow through overnight and if you’re not long already then this may be the last opportunity to hop on the bus. Of course this also may be a good spot to sell the rip.

The hourly has us a few ticks over that diagonal on the hourly I painted a few days ago. And clearly it’s a bit of a coin toss here. Three reason why I chose the long side:

First, the Zero is rather divergent as this point.

Second the volume profile suggests a spike low on the daily. We’ve got sufficient mojo here to get us to about 1960 at which point we would have to review the situation again.

Third we are just below the daily NLBL at 1890. YES, you are right – this could also be a perfect selling opportunity. But again, that spike low on the daily looks played out for now. Even if we drop from here today odds [right now] suggest that it will be held. Caveat – we didn’t touch the lower 100-week BB. But then again it’s more academic as it hasn’t been touched in this decade.

Finally, we’ve come a long way in the past few weeks and the timing ‘feels’ right (yes, I know – I can’t believe I just said that) to shake out some of the late comers. So let’s see how it goes. My stop is below the 100-hour SMA. We may just touch that during the session and then bounce – but even if we do I think the Zero is going to point the way. So for now a stop below 1867.75 seems to be represent a reasonable risk/reward ratio.