The Nasdaq tested resistance in early action but failed. It looks like we've carved out a tweezer top reversal pattern and so I'm expecting some weakness in the short-term. The next major support level is the rising 50 day MA, followed by the April highs at 2375. I'm watching the RSI closely as it approaches the 50 mark. A sustained break of the 50-45 level would signal a downtrend. Notice how the ADX line has come down to 17.5 from a high of 40 over the last month as price consolidated under the current resistance level. The D+ and D- are knotting up, making it difficult to determine if the next momentum phase will be up or down.Trading this week will likely be low volume as many traders take off for the holidays. Tomorrow's economic calendar includes Housing starts, Building permits, and PPI (all at 8:30 EST).
Tweezer Top - Tweezer tops are two or more candlesticks with matching tops. The tops do not have to be consecutive, and size and color are irrelevant. It is a minor reversal signal that becomes more important when part of a larger pattern.
2 comments:
Hi jamie.
I was just discovered your site and i love it. Do you do any premarket setups? thnx.
Basim.
Hi Basim,
Thanks for the kind words. I don't have much time to do premarket setups because I am working right now. However, I do plan to post some technical setups when I get back to trading full-time (in a few months).
BTW, you seem to be doing pretty well on your own. The RIMM trade last week was quite masterful.
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