It’s neat – and efficient – when the market does exactly what it should do!
Probabilities strongly favored a snap-rally (intraday reversal) springing off the current support-with-divergences price levels in the stock market and that’s precisely what we’re seeing this morning.
Let’s see the bounce, how it happened, and where we’re aiming now:
To set the stage, here’s a few planning quotes from last night’s membership report:
We’re still building positive divergences and the probability – at the moment – still favors another intervention reversal up away from the current lows.
We’re still labeling our DOMINANT/LOGICAL thesis as the support-bounce and pro-trend continuation thesis which has us playing bullishly up away from 2,080 toward 2,100 or higher.
This morning shows the “intervention reversal” and now we’re seeing the “pro-trend continuation playing bullishly up away from 2,080 toward 2,100 or higher.”
Buyers and sellers battle at key inflection (pivot) levels but ultimately only one side can win the battle.
It’s our job as traders to plan either outcome and be ready for the dominant (in this case, a bounce) thesis to trigger or the alternate (a breakdown here) thesis.
Our trades – swing or intraday – come from these planning strategies as we trade in real time toward or away from key levels.
For now, we’re focusing on the simple 2,100 inflection level – a Round Number Reference – and if buyers can push the market above that pivot, then we’ll play for higher price pivots as noted.
We’ll go over more details for members but I wanted to highlight this great example of planning plus execution.
For more daily updates from Corey, visit his blog at Afraid to Trade.com.