Weekly Recap: It looked all week that the market is showing signs of weakness and a correction is coming. On Thursday the bears came out of the cave roaring and pounded the market lower to lose all the gains it made in the previous 9 days, but on Friday the bulls charged back taking the SPY almost all the way back up. From a daily perspective a new high will create the negative divergence that was lacking so far for a correction. The weekly chart still has a negative divergence, but one or two more green weeks like the last ones will negate it, so bears have to make a move soon.
On Thursday night I wrote that the strength of the correction will determine what I do well it was a strong bounce so all positions were closed , and I expect more upward movement. I am waiting for a correction to the trend lines to see if a reversal signal is issued.
Battle Plan for the 11/11/2013
Neutral, waiting to see where the correction will take us.
* Stop loss lines should be triggered if there is an interval close above them (i.e. 60 min or 120 min ), they are published in the daily blog and updated during trading hours on twitter.
* Take profit lines should be triggered immediately when crossed, they are usually issued during the trading day on twitter.
* Entry signals should be triggered when crossed, but take into account that until there is a confirmation (i.e. close of the interval across the entry signal) , the signal can become a reversal signal.
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