Bears Are Still Losing The Fight
- Posted by TheArmoTrader
- on October 13th, 2011
Even as we failed up against major resistance, the selloff one would have expected from that, given the pin-pong action was very tame. We gaped down but I never felt fear or heavy selling today. I wanted to add to my ProShares UltraPro Short S&P 500 ($SPXU) swing position but I never felt I had a good spot to add to. I wanted to see some type of gap fill attempt before I added. Once I saw that we were headed for a gap fill, I decided not to touch my position until next week (stop for half right above 122 still). The bears are still losing the fight. So what happened?
$SPY – SPDR S&P 500 30 minute chart.
As you can see, after setting a new low for the year, we have had an amazing rally with little selling. We failed at the infamous 122 level, but after gapping down today, we filled the gap right back up. You might be saying, wev’e gone up on low volume, that is bearish! I say no it is not (read this to understand why). The next immediate level that the bears should have broken was this prior resistance that is now acting as support at ~119.25. We slightly traded below it today but the selling was not enough to break through.
What will I be watching next? So far, we are still in an uptrend. Being short is counter trend. However, we are in a range between 119.25 and 122.00. Play these levels accordingly. Even though I am short I am biased long as long as we hold 119.25 (Yes,weird but its all about risk/reward).
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Jerry Khachoyan is currently an undergraduate student at UCLA pursuing a degree in Political Science. He started trading in September of 2008. He concentrates on using technical analysis and reading the tape to enter the best risk/reward trades. The stock market to him is one of the greatest inventions by man.
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