*Accuracy review update: 94% or 17/18 predictions correct*
Day’s theme: A move to the downside, however this is nullified and somehow counteracted.
Behavior around the high: There is something having to do with a merger between two parties or some sort of agreement between two leaders.
Behavior around the low: A rally along a diagonal trend line that ends with a fast, sudden move higher, followed by a break down through that diagonal trend line with increasing volatility as we move forward.
Trade opportunities:
I’m advised to trade around the completion of a rally.
Around noon, there’s an opportunity for a trade in the midst of three criss-crosses through the same price level.
There’s a cash-in opportunity for a day trade around 1:00 p.m. if you bought puts around the high.
There’s an opportunity to open up a short position as protection toward the end of the day.
Overview:
On August 9th, there’s a notable reversal that will stand out on a one-day chart as well as a day’s low in the pre-market. Around the open, there’s an important resistance level highlighted. In the first half hour, there’s some significant volatility. We have a breakdown through a support level to meet a secondary support level. Between roughly 10:00 a.m. and 11:00 a.m., we bounce sideways along that support level. Between 11:00 a.m. and noon, there’s a trade opportunity in the midst of three criss-crosses back and forth through the same price level. This will mark the confirmation of a bullish trend, however I would advise opening up protection around this time. My sense is that we’ll have a high midday.
We fall from that midday high due to negative headwinds. Somewhere around 1:00 p.m., there’s a trough that forms from overselling. There’s a cash-in opportunity for a day trade here if you bought puts around the high. We then have a big move to the upside out of that trough between roughly 1:00 p.m. and 2:00 p.m. That rally to the upside continues into the 2:00 p.m. to 3:00 p.m. hour. The completion of that rally marks an opportunity to open up a short position to protect against long positions. In the last hour of trading, we move higher out of a day’s low and push the upper end of a range on a one-day chart. Right at the close, there’s a failed attempt to break through a key resistance level, followed by a decline through a key support level into the post-market.
Sneak preview:
There’s a lower low on August 10th.
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