We Have Movement
Finally we have something interesting to talk about. We are approaching a good place for a quick long. Yesterday I mentioned that both Mole and I thought that further downside without another leg up was just setting the stage for finding a bottom a little further down. That is exactly what happened.
I’ve marked the triangle which I noted yesterday as a trading guide for the day. It broke to the downside, then hit a double bottom, retested and posted a very strong kickoff.
This is exactly what we should see in order to attract sideline dip buying bulls, and stop out already weak shorts. Daily handle was a hammer. Get long on break of the daily high (in market hours) with a stop below the daily low.
The only problem I have with this is the after hours action is weak, overextended, and choppy. I think there is a high probability of a little shakeout on open first, you might be able to get a better entry.
The other thing of interest is that Trump opened his mouth about the dollar and it fell, testing the old spike low. Realistically this is about as far as downside can be allowed while still maintaining the strong dollar thesis. This is an outstanding point to get positioned, because the risk reward is incredible, even though the odds of success now are not better than 25%. A close below the green line invalidates the idea, and being good traders we should probably flip and be short.
Lastly, it is very interesting how breadth is strengthening into the move. This looks good from every level.
So bottom line, advantage bulls. Good trading today people 🙂