September 14, 2011
Uncategorized
By Geoff Bysshe
Today's training video for ORSF and DTHS members was about the 60-min time frame because it is so applicable to the current state of the markets. The charts below show the market watch 4 on the 60-min. charts with the 200 (black), 50 (magenta), 20 (red), and 10 (green) period moving averages. The cyan line is the resistance line from the recent swing high.
In the last Focus List, I described yesterday's action as consolidation so it was not surprising to see somewhat of a directional day today. We saw lots of good breakouts and long OR reversals (not to take away from the shorts that worked) today. The indexes were more muted that our focus list stocks, but therein lies my reason for posting the charts of the 60-min market watch. They were fighting the intermediate trend as defined by the simple moving averages.
Tomorrow, all will have pivot stack that suggests a bullish bias over S1 so that is an important reference point tomorrow especially with the market running into resistance created by the moving average going in the opposite direction.
Considering the location of the price vs. the MA's on the 60-min chart, my favorite index from the long side for trading reversals or breakout trading to the upside will be the Q's. For the shorts OR breakdowns below the FTP and S1 in the SPY's are an option, but there are individual stocks on the Focus List that should be better opportunities for shorts. Many are inside day's and/ or negatively stacked.
The daily market watch charts are in the middle of the 1 month compression and the Q's have a very well defined wedge. Until the market moves out of the wedge and consolidation it is going to be increasingly important to know your targets and take your profits and don't expect too much.
Follow your system, don't try to hit home runs.