Timing Stock Market Successfully
  • Home
  • Members
  • Testimonials
  • Subscribe
  • Contact
  • Home
  • Members
  • Testimonials
  • Subscribe
  • Contact

Signals & Trading Plan for Thursday 6/6/19

6/5/2019

0 Comments

 
Members click here for full article.
(It is currently free to join our membership.)

Here is an excerpt from our trading plan.


Underlying imbalances
Back in early May during the terrible tweet storm, we wrote about how volatility ($VIX $VXN) was not surging.  There was no sign of true panic under the hood.  Market internals were looking healthy.  Only that trader sentiments were getting extremely bearish. 

We wrote that this unique combination creates a bullish divergence, which can be highly profitable for bulls. 

On Monday 6/3, Drop2 of the May Down Trend ended. 

On Tuesday 6/4, $SPX $NDX $RUT launched themselves into Bounce2 which can be viewed as a typical corrective bounce of a down trend.  However, it may very well turn out  to be Surge1 of the new Up Trend, because of the Fed hinting at rate cuts.


Adam Grimes (author of the excellent TA book "The Art and Science of Technical Analysis"), wrote:
"This is important. In fact, it is the single most important point in technical analysis — the holy grail, if you will. Every edge we have, as technical traders, comes from an imbalance of buying and selling pressure. That’s it, pure and simple. If we realize this and if we limit our involvement in the market to those points where there is an actual imbalance, then there is the possibility of making profits. We can sometimes identify these imbalances through the patterns they create in prices, and these patterns can provide actual points around which to structure and execute trades. Be clear on this point: we do not trade patterns in markets — we trade underlying imbalances that create those patterns.”

Keep this in mind as you hone your own trading system and craft your trading plans.   Our goal should be to use technical patterns and technical data to identify the underlying imbalances and trade them.

To focus on just the price actions of charts alone seems to be a bit short-sighted to us.   Therefore we always try to look under the hood.  That's where we can identify the underlying imbalances.  And in our experience, these underlying imbalances can show up days or weeks in advance of a major move.

So anytime you hear "bullish divergence" or "bearish divergence", those are hints that there is a big underlying imbalance forming.  They offer low-risk, high-probability, high-reward setups to trade.

Trading Plan
So the questions to ask now are:
  1. If it's Surge1 of Up Trend, where will it end?
  2. If it's Bounce2 of Down Trend, where will it end?
  3. How do we know which one it will be?
  4. How do we plan our trade?

Register here to read the rest of this article, and to get the full details of our trading plan.  All free.
0 Comments



Leave a Reply.

    Archives

    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    March 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019

    Categories

    All

    RSS Feed

Copyright (c) 2019-2022 LOOK Systems LLC
All rights reserved.