At the moment, this market is showing continued signs of momentum. When I say watch for reversals, that does not mean I am , I am just open and flexible to what the market can show next at such levels. Since the triple bottom formation off the 11600 low, this market has been producing high lows and higher highs. There is nothing about that type of structure and implies momentum.
The current price area is very conflicting because the location implies a greater chance of selling, while price momentum shows no signs. So how do you navigate a situation like this? You go with the momentum until the market proves otherwise. To protect yourself and reduce risk, this area presents an opportunity to lock in profit, NOT get short (yet). Like I have explained in other reports, it is a best practice. Holding onto a smaller portion of your position allows you to participate if the market decides to break through the and retest the 20K area.
Since this market has broken out of a triangle, there is mounting evidence on the side, especially since the low of the triangle represents a broad higher low on the bigger picture. Everyone gets caught up in the because they cannot see beyond the chart. patterns are good for smaller time frame trading like day trading or scalping, not
broad counter trend moves. The environment for this market is very . Charts are a way to organize data and get a sense of temporary market intentions, not to base long term opinions on.
As far as swing trades go, IF the market retraces and offers a lower risk buying opportunity, the levels to watch are the 14465 (.382 of recent swing) or the 13420 to 12660 area (.618 of recent swing). Also 15000 is worth noting because it would be a retest of the triangle boundary and a old resistance/new support. reversals in these area present more attractive buying opportunities in terms of risk compared to where price is now. Especially the 12,500 area which is the range low, great place to take a swing trade or position trade upon confirmation.
In summary, anticipating which way the market is likely to move next is only one piece of the puzzle. Ultimately, the market leads and the best we can do is adjust or "listen". Right now this market is at a resistance which is an area to anticipate more selling than buying on the short term, BUT there are no significant signs and until there are, we can reduce some risk by locking in some profit or take no action until the price gives more of a reason. As long as the momentum does not change meaning price does not break any supports, or hardly retraces, then it is likely to continue higher. A push through the can lead the way to a 20K retest, while any retest of support has a greater chance of holding as long as this market is generally strong. When you wait for a lower risk opportunity, like a reversal off of a significant support, when situations like the one we have now come along, you have a lot of flexibility and favorable choices. This is much better than buying impulsively only to find yourself at the mercy of the market. Patience is strength, greed is weakness.
Comments and questions welcome.
Bulish, bulish, bulish " this market is showing continued signs of bullish momentum" and so on.
And what happends?
Words can't describe how little you give a ....
You are just market maker.
Feel sorry for you Mark.