Jeff, I think you may have been on to something with your end of quarter high (although it was lower than options expiration) and a drop into the July 8 turn. We'll see if that works. It seems to be lining up as a decent possibility, as we're still in the downchannel from May, and the lower channel now has some more room to drop, getting us closer to the low 1300's.
Usually when we have these reversals on a re-test, we have a spinning top doji or a bearish engulfing candle.
Today we printed inverted hammers and imperfect gravestone doji's (SPX) on the indices. Those are reversal sticks, and I cannot recall ever seeing those candles off a good bottom. We will need confirmation of those candles on Monday, and the indicators seem to be pointing to that happening.
One conclusion we could make is one scenario I had Wednesday - this may not be the bottom, and we rise up to an EMA or a BB and reverse down to a lower low.
Well, we reversed at MA's on most averages, so I give a bit more credence to this scenario tonight. We'll need confirmation on Monday and Tuesday, of course. However, we should be on the lookout for this.
I closed my DJX puts in the AM (I'll never trade those again, I hate the way that index moves) and opened QQQ puts over the course of the afternoon at NDX 1065 on the 60-minute slow/full stoch cross-over, 1058 on the break of the rising wedge, and 1048 when the EOD candle was more readable.
One thing we did have today was a steady slide in the VXN on a 45-degree angle, which is one of the things I was looking for yesterday. We need to watch the VIX and VXN Monday to see if they continue to drop. If so, maybe we do get a successful bottom re-test after all.
Anyway, those are some of my thoughts right now on what's happened the past couple of days. |
