My prediction in my last post came true. The micro short on the daily chart (left) traded to target. This resulted in a slightly lower low with positive divergence of the RSI foreshadowing a short-term reversal.
How to take advantage of a potential.reversal? Move to lower timeframe. Look for:
- Positive divergence of RSI to lower price.
- Wait for price to take out previous swing high.
- Wait for base to form - at least two relatively equal points form a base. In this case AAPL touched 517 twice before retracing.
- Buy the ambush.
However, this still a counter-trend trade to take us back to the bigger setup at $605 which is an ambush short.