Day’s Theme: A sharp drop that stands out within a period of volatility.
Behavior Around the High: The establishment of support on a one-day chart. There’s a prominent move higher off of that support followed by the establishment of support at a higher price level.
Behavior Around the Low: An important range on a multi-day scale is highlighted around the low.
Trade Opportunities:
An opportunity to close out of a long position at the end of the day if one was opened on the 25th.
An opportunity to open a short position in the midst of bumping along resistance early in the morning. I would hold that short position until we’re rotating along support between roughly 2:00 p.m. and 3:00 p.m. I would hold that position overnight.
Overview
On May 26th, there’s an important support level highlighted in the pre-market that we’ll have a lot of price change from. We’ll go from a crest to the establishment of support right around the open. There’s a rally to meet a key resistance level on a one-day scale followed by a decline with consecutively lower spikes up on the way down into roughly 10:00 a.m. We’ll then see some bumping along resistance. We might break through resistance at some point.
From roughly 11:00 a.m. to noon, there’s a decline that increases with momentum moving forward in time. Between noon and 1:00 p.m., there’s a significant move higher on a one-day scale that takes us to a peak or crest. We’ll revisit a crest within some erratic behavior back and forth through the same price level between 1:00 p.m. and 2:00 p.m. That’s followed by a sharp decline off of that peak or crest somewhere around 2:00 p.m. We’ll meet a key support level and rotate along that support level between roughly 2:00 p.m. and 3:00 p.m. That rotation ends with a fast, sudden move higher. We’ll have some volatility in the last hour that also ends with a fast, sudden move higher and takes us into a key resistance level around the close. Around the post-market, there’s a failed attempt to break through key resistance followed by a decline through key support.
Sneak Preview
On May 30th, we’ll open lower.
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