Courtesy of David at All About Trends
Here we are sitting in the zone.
In our mid-day update Friday I said:
"Part of me would feel safer seeing a retest of recent highs for a mini double top (little red line at 1120 or even the 1131 level before a drop as that would mark a double top at a retest of 1120 and/or a 5th and final wave higher."
The rest of the week has a strong possibility of us chewing around into the Jobs report on Friday morning. In the past at turning points (in this case up to down) more often than not we chew around for 3-8 days. See the blue circles in the chart below.
Going forward that may be just what transpires from here on out. BUT I still wouldn’t rule out another news driven suck em in on some event to tag the 1131 level so again that level is still in play
If they want to spin it and inflict max pain on the short sellers out there all the while sucking in the little guy then the jobs report could be the ticket. In this case ? Beware of pop and drops fade the gaps news events.
Who is "They" you may ask?
They are the propietrary trading desks of traditional wall street’s in thru the back door in the morning gang which is code for the program trading desks of the major wall st. firms, you know the ones who tell you to buy and fold yet trade around with the programs?
All the while this chewing around is occuring patterns are developing that we can work off of and that is just what we’ll do. We are putting together a list and as they get closer to developing we’ll bring them front and center to youre attention.
Speaking of suck in the little guy? It appears that the biggest cheerleader of them all seems to think the sky is the limit for VMW- VMware AFTER it already took off mind you.
This is exactly what you want to see from a human psychology standpoint emotionally speaking and lets face it he is mr. emotional. That’s just one small thing that I add to my asenal of what I want to see when looking at a stock and decide whether or not to take a trade, that being the human nature element. See that potential mini double top? See that Pink trendline? Its all you need to kow for shorting.
In Summary:
Given everything above we will sit back as we are at one resistance level as we speak with the next one not far away and in "The Zone".
To learn more, sign up for our free newsletter and receive our free report — “How To Outperform 90% Of Wall Street With Just $500 A Week.” David’s offering our readers a Special, two months at $10 a month. – Ilene
