Bears Seizes Yesterday’s Failure To Breakout

(SPY) –  .  The Bears seizes yesterday’s failure to breakout with Bullish follow through as a chance to step into the light. On May 10, “I wrote last week’s Channel is looking to get tested. I put the top channel line about $238.80 and the bottom about $237.70”. At the moment, the morning futures are between the two numbers. Below $237.70 would put enough pressure on the SPY to test the $235.50 area, and this may not be in the best interest of the Bulls and the 2017 summers future.

A weak close today below $280.80 would drop price below our lower T-Line Band, a close below the Lower T-Line Band could start the slide to test the lower numbers and set the course for the summer.

Over the past six trading days, the VIX has drawn a Doji and Bullish Engulf pattern followed by a follow through gap, then a PBO to support creating a Bullish Inverted Head and Shoulder bottom. On the 4-hour chart, I see a PBO Morning Star signal with price and Volatility Stop support.

Yesterday before the close I announced to the trading room I was buying UVXY, I am long at $11.72. My plan today will be no new buys, just manage what I have and build on a watch-list.

FREE TRADE IDEA – TZA

TZA – If you remember, on April 27, I recommended to Hit and Run Candlesticks Inc. trading account to buy TZA. Hit and Run Candlesticks did and still owns ½.The Bullish Morning Star on the daily chart and the Bullish Engulf on the 2 & 3-day charts have pushed price to resistance, and now the consolidation could be nearing an end.

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What is a Trade Idea Watch List?

A trade idea watch list is a list of stocks that we feel will move in our desired direction over a swing trader’s time frame.  That time could be one to 15 days for example. From that watch-list, we wait until price action meets our conditions for a trade.

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Rick Saddler is not a licensed financial adviser nor does he offer trade recommendations or advise to anyone except for the trading desk of Hit and Run Candlesticks Inc.