Step 1: Break through bear trend (red line)
Step 2: Turn that into support
Step 3: Golden Cross on 50/200 day
We crossed off the first two steps over the past 3 days, and now the moving averages are threatening to cross in the next 12-24 hours. It is ideal to see the price pullback into the moving averages before getting the golden cross. Therefore this is a healthy pullback and could be teeing up the entry for a leveraged swing trade.
I need to see the price support above $7,750, otherwise we will be back in no man’s land. If we bounce from here then that would create another higher low and it would bode very well for the bulls.
As I continue to wait for final confirmation I am reminded of a quote from Revolutionary War General William Prescott:
“Don’t fire until you see the whites of their eyes”
Happy trading and remember that following is free!