Last night we talked about BIDU. This morning I mapped out former gaps as areas of potential support/resistance. The lower gap dates back to Sept. 8th and the upper gap dates back to Oct. 6th.In pre-market sellers were pushing prices lower and eventually reached and probed the Sept. 8th gap at $350 - $343. Buyers stepped in at $350 in pre-market and when the market opened BIDU carved a wide opening range. The bulls were in control and sold into strength as the October 6th was filled.
Mapping out gaps of widely held names is a good way to spot good trading opportunities.
Last night we anticipated further downside and weak consumer confidence data triggered the first short. A fast move lower, but buyers stepped in too quickly and I tightened the stop to 1725. After a quick retracement, prices started to drift lower and finally setup a low risk entry just below S1. This time we reached S2. The SPY didn't confirm a lower low in the afternoon, so it was time to get long.
Last night we anticipated GLD would hold gap support. Now it looks like it might form a base at $102. If it retests today's lows and holds, that's another way to trade it.
The markets have had three consecutive lower closes, and conversely, the greenback has three consecutive higher closes. Prices are closing in on the 50 SMA on the dailies, so we do expect some retracement to come into play at those levels.Keep a close watch on economic data at 8:30 - Durable orders; 10:00 new home sales; and crude at 10:30.
2 comments:
You are a genius Jamie. BIDU trade - excellent.
LOL,
The gap at $350.00 round $ level was widely watched, that's why it worked.
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