*Accuracy rating update: 100% or 15/15 predictions correct*
Day’s theme: The halting of a bullish trend market by a sharp decline though a key support level.
Behavior around the high: Sideways fluctuations with a bearish trend that precedes a rally.
Behavior around the low: The day’s low will be early in the day and is a good point to open up a position in both directions utilizing options strategies.
Trade opportunities:
An opportunity to open up a short position around a distant resistance level between roughly 10:00 a.m. and 11:00 a.m. I would hold this put overnight.
An opportunity around noon or 1:00 p.m. to play both sides of the market. I’m advised to also hold this position overnight.
Overview:
On December 5th, we’ll have a period of sideways rotation in the and a sharp dip that will stand out on a one-day chart in the pre-market. That dip will bring us to a support level that was a recent past opportunity. There’s a rally to the upside right around the open, however we’ll then break down through a diagonal trend line that we were rallying through. Volatility will increase as we break down through that diagonal trend line. We’ll then see a big move to the upside that pushes for distant resistance from roughly 10:00 a.m. to 11:00 a.m. I’m advised to open up a short position around that resistance level. We’re bound by a range between roughly 11:00 a.m. to 1:00 p.m.
There will be multiple failed attempts to break through key resistance from 11:00 a.m. to noon followed by a drop to the bottom of a range roughly around 1:00 p.m. This offers an opportunity to play both sides of the market. Out of that decline there is likely a move back to the upside followed by a support level that we sell down through right around the close. We’ll then see a U-shaped reversal back up through that support level and reuse it as support. There will be some criss-crosses through the same price level in the post-market.
Sneak preview:
A lower low and some sideways fluidity with equal amounts of bulls and bears trading.
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