Chart analysis before the short was triggered is available in First Post. Market behavior since then so far is close to analysis i.e., trapped out eager shorts for a loss who entered near high risk zone (1st circle) and then turned down near low risk short zone (i.e., 2nd circle). Post-1 has locations of these circles and my reasons for waiting for price to come to 2nd circle.
What's next?
Three aspects bother me about this chart. One is the low volatility up move (i.e., up move since January) instead of good swings. Problem with low volatility moves is they look weak and tempting but don't pan out as often as one expect. 2nd aspect is, now market is in a location that is attractive to bulls also (i.e., longs who like to play 1st pullbacks). 3rd aspect is the resistance turned support lines present in front of price (blue dotted lines on chart).
Given above, I think there is good chance market likely have stall near exit-1 line on the chart. After that market might do one of two things - (a) resume down move to exit-2 line on chart or (b) reverse and start an up move (if bulls are strong).
So my preference is to take profits on part of the position at exit-1 line (as present on chart) and move the stop on the rest to break even (red line on chart). This way we get payed and also have a freebie position to participate should the down move materialize.
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